ESTIMATES, MINISTRY OF AGRICULTURE AND FOOD (CONTINUED)

ESTIMATES, MINISTRY OF AGRICULTURE AND FOOD (CONTINUED)

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The House resumed at 8 p.m.

House in committee of supply.

ESTIMATES, MINISTRY OF AGRICULTURE AND FOOD (CONTINUED)

Mr. Chairman: We are continuing in committee of supply with the Ministry of Agriculture and Food. If memory serves me correctly, the honourable minister was speaking.

Hon. Mr. Timbrell: Mr. Chairman, when we rose at six o'clock I had begun to respond to some of the issues raised by the members opposite in the course of the opening statements. I think it was the member for Welland-Thorold (Mr. Swart) who raised the question of the responsibility of the ministry beyond the farm gate. Clearly, we do see that the ministry has a role there: one need only look at the programs of the ministry with respect to grading and quality and with respect to the participation of the retailers in various promotional programs.

The honourable members will know that from time to time there are a number of promotional efforts, usually sponsored by the marketing organizations of the producers, and we have quite a substantial effort, in fact, through our Foodland Ontario budget where we cost share these promotions. Sometimes it will be with the apple marketing commission to promote Ontario macs or Ontario delicious apples; another time it will be with the vegetable growers' marketing board, the tender fruit producers' marketing board, whatever -- a number of these.

So we do get involved in all aspects, and, of course, through the Board of Industrial Leadership and Development program we have become even more involved in processing and storage and in trying to identify the areas within the total agribusiness sector where improvements are needed in our competitive position.

Now the member for Riverdale (Mr. Renwick) is going to try to sell the Chairman of the committee of the whole House a calendar in support of a very worthy cause. No, he is not going to do that. He is going to go to the member for Stormont, Dundas and Glengarry (Mr. Villeneuve) so that he meets his quota. You have been saved. Get your buck out anyway.

At any rate, we have attempted in the reorganization of the ministry to order our priorities in such a way that we can better support the efforts of the various elements of the private sector with whom we relate, and I am going all the way from our rural organizations and services branch, which deals with the 4-H clubs, the junior farmers' associations, the women's institutes, the soil and crop improvement associations and various producer organizations at the local level, to the new food processing branch -- through which most, if not all, of our efforts to date under the BILD program have been directed -- to the educational institutions that come under our ministry.

I would say to the member we do see a role for ourselves and we try to do it in such a way that we support the efforts of and build on the strengths of the private sector, all the way from the individual producer right through to the retailers.

In his remarks, the member touched on matters of concern to him that have to do with trade practices. While I would have certain views on that as a member of the cabinet, we do not have a responsibility in law for trade practices. I think that has been borne out by any number of investigations, including the one to which he referred.

We rely strongly on the federal government through the combines investigation branch and the various other branches and departments of the Department of Consumer and Corporate Affairs of Canada to ensure that anything untoward in trade practices is not only investigated but is corrected.

We have strong ties to all elements of the agribusiness sector as far as the promotion of good farm practices, good management practices, research into new horticultural varieties, new breeding work and that sort of thing are concerned, all the way through to the processors and the retailers. I will not go into all of the many organizations we deal with.

The member expressed concern for the share of market enjoyed by the independents. It is rather interesting to look at some of the figures for the chains and the independents. My staff got me some figures from the Maclean-Hunter Research Bureau which are interesting. This covers the period from 1979 through to 1982. It confirms that the retail chains do have a sizeable chunk of the market, but it has started to slip a bit.

It would indicate that across Canada the share of market enjoyed by the chains has slipped from 60.4 per cent in 1979 to 59.1 per cent as an estimate for this current year. The independents in turn have enjoyed an increase from 39.6 per cent to 40.9 per cent.

The share in Ontario tends to be higher. As to whether that is because of the concentration of the population of this province in urban centres, I suspect that has a lot to do with it compared to many other provinces. I know in my own constituency, thinking back over the last 11 years since I was first nominated to represent my party, the number of small independents has not grown. I know there have been a few which have gone out of business but in some cases have been recycled through other hands. I think that may be a function of the Ontario market compared to the overall Canadian market.

Mr. Swart: What is the percentage?

Hon. Mr. Timbrell: I do not have the 1982 figures, but the 1981 figures would indicate about 31 per cent is the revised estimate in market share for the small independents as opposed to 40.7 per cent in Canada. It is lower.

8:10 p.m.

As the member knows, from time to time various proposals are made as to how we could support the small independents. There was one proposal made to me recently, and I do not mention it here to say it is necessarily going to be acted on right away, but it is one that has been made and we have been discussing it with the Ontario Grape Growers' Marketing Board and the Canadian Wine Institute. Both have suggested -- and I am sure they have made representations to the members as well -- that we should institute a policy whereby domestic wine would be sold in the independent groceries of the province.

The suggestion is that it would do two things: maintain or increase the share of the wine market for our domestic products and at the same time support the small retailers. Whether either of those is a likely outcome is what we have to review within the context of our overall policy on liquor, wine and spirits.

Philosophically, I certainly support any reasonable course that would support the small independents as an alternative to the large chains, but I think inevitably the population is still going to shop by price. If my wife is anyone by whom to judge the market, and I think she is very typical of grocery buyers province-wide, whether they are in urban or rural Ontario, she shops price. We are never going to escape that. The members opposite as much as the members on this side want to be sure that the trade practices or combines laws of the country are not being flouted.

Mr. Swart: Supermarkets now own dairies which refuse to sell to others.

Hon. Mr. Timbrell: We cannot escape the fact, though, that in the last two decades the cost of food in this province and this country, as a share of disposable income, has dropped significantly. I am trying to remember my figures. In 1960, if I recall correctly, it took about 21 per cent of disposable income on average to buy food. Now it is around 17.5 per cent. The fact is we have the second-lowest prices in the world.

Now that I think of it, I want to take issue with the member for Huron-Middlesex (Mr. Riddell). In a recent speech to the Lambton Federation of Agriculture, he included in his remarks something to the effect that since the government of Ontario supports a cheap food policy, it should do X, Y and Z. There is no such thing as a cheap food policy. I heard that for years before coming to this portfolio. I cannot find a cheap food policy anywhere in the files or the annals of the ministry.

If anything, we believe very strongly that we have to find ways to improve the return to the producer for his or her efforts. That is why we are so strongly supporting the development of this improved national stabilization program.

Beyond the farm gate, it gets into several other sectors over which the producer does not have control and which, to a great extent, comes under combines legislation and other pieces of legislation that pertain to competition in the marketplace. I just want to say to the member, as I think I have said to him before, privately or publicly, I cannot find that cheap food policy. It does not exist in Ottawa either. If he knows where it has been written in stone somewhere, please show me because it is certainly not the policy of this government to support lower food prices at the expense of the producer.

There is no question that ours is very competitive marketplace. As I said, there is no question we have to find ways to support the producers to ensure a more predictable or more adequate return at the farm gate.

Hon. Mr. Eaton: I see free enterprise is at work over there.

Hon. Mr. Timbrell: That is the free enterprise member for Riverdale. He is very keen. Would you guys just buy one each.

It is worth mentioning that the federal government has been trying for some time to develop new competition legislation I think there is general agreement that there is need for that.

Mr. Swart: But the former Minister of Consumer and Commercial Relations opposed it publicly time and time again.

Hon. Mr. Timbrell: It is stalled. There are various parts of it, yes, but the efforts have stalled.

Mr. Swart: But you helped stall them.

Hon. Mr. Timbrell: Just hold on and listen. If they thought they had found a formula that met their requirements and served the public interest they would have put it through by now. Obviously they have not been able, even after all their efforts, to arrive at something they can sell.

The member was saying, in effect, that the Minister of Agriculture and Food was not regulating the retail sector. No, we do not regulate them; they do not come under us. But we are involved. He was saying we were not involved beyond the farm gate. We are very involved beyond the farm gate in the areas for which we are responsible; that is, to promote Ontario agricultural products, to promote replacement of imports, to promote improvements in the food processing and storage sectors. We are very involved in all of these things.

The member for Huron-Middlesex referred to some remarks by my deputy minister, Mr. Allan, who is with us. I think I rose on a point of order and privilege, or both, at the time. I can only take the member's remarks to suggest that he interpreted that my deputy minister was attacking marketing boards per se. Such is not and was not the case.

As a province, we have supported for years the right of producers to choose freely to establish marketing boards. We have five supply management marketing boards in place now that oversee about a third of the agricultural output of this province. He was not -- nor was I when I spoke to the Dufferin County Federation of Agriculture at Grand Valley about five or six weeks ago -- attacking the principle of marketing boards. In fact, I think we both went out of our way in the course of our remarks to say we support them.

However, having said that, we do have a significant issue to take up with the poultry agencies of Canada. That relates to the issue of overbase quota. I want to give the member some of the figures, starting with the Canadian Egg Marketing Agency, because he quoted something from the general manager of that agency, Mr. Brassard, as the definitive rebuttal of something I had said or the deputy had said or both. I do not know.

Ontario today has the right to produce 38.16 per cent of the nation's supply of eggs while we have 35.65 per cent of the nation's population. Therefore, we are a slight net exporter of eggs. We produce 38.1 per cent and consume 37.9 per cent. That 0.2 difference is export.

8:20 p.m.

Mr. Brassard -- and the member apparently bought this argument -- implied from this that Ontario is getting its fair share of quota. In fact, we are disputing the distribution of overbase quota and not disputing the current allocation of base quota. We are not trying to take the Canadian Egg Marketing Agency or the chicken agency or turkey agency back to first principles and say, "Look, you had better redraw the whole thing."

We agreed years ago to certain shares of the market and we are not trying to break our word. We are not trying to undo what was done, in some cases, a decade ago. What we are disputing is the formulae which these three national agencies are proposing to use to allocate overbase quota, quota to meet growth in demand as a function of either greater consumer preference for the product or growth in population or both.

Looking at CEMA, it has been proposed that the four western provinces will get 59 per cent of future quota increases, while Ontario and Quebec between them would share 34 per cent. That is what we are disputing. It is for that reason we have asked the federal minister to convene a meeting of the signatories, in this case to the egg plan.

I ask the member to stop and think about it: Quebec and Ontario to get 34 per cent of overbase quota for eggs and the western provinces 59 per cent. That is totally out of sync with the distribution of population; it is totally out of sync with the distribution of consumption and it is certainly out of sync with the comparative advantage which Ontario has.

I want to remind the member that in the formulation of all these plans, comparative advantage is stated as the criterion which the national agencies are to follow in the allocation of quota. In the case of chickens, eggs and turkeys, we are the most efficient and cost-effective producers of all three commodities in this country. We simply say that what they are proposing is not good enough.

I and my deputy and other senior officials met about six weeks ago, or even longer, with representatives of the three boards -- some people call them the feather boards, some call them the poultry boards: the egg, turkey and chicken boards -- and urged them to do everything possible to make sure that at the national meetings of their agencies these proposed 1983 allocations did not go ahead as far as overbase quotas are concerned, because they are not fair.

I understand that the federal minister has referred the matter to the National Farm Products Marketing Council, chaired by the lady from Winnipeg whose name escapes me. They will soon be reporting back to him, I hope favourably, to say, "Yes, there should be a meeting of the signatories to try to straighten this out."

I want to assure the member in the simplest way I can that my deputy minister was not and is not attacking the marketing boards. He is not attacking the philosophy on which they are based. He is certainly attacking, as he should -- and I am attacking where it is appropriate -- the ways in which these three boards are proposing to allocate overbase quota to our producers. It is not fair, it is not equitable and it is not good enough; we will do everything possible to support our producers in getting a fairer deal on overbase quota.

We are not proposing to destroy these national plans. It is unfortunate, for instance, with regard to the milk plan, I do not know whether the members are aware of this, that British Columbia has served notice that it is withdrawing from the national milk plan. I think that is very unfortunate. There is a whole different history as to how that has arisen, but I am told it may very well proceed to withdraw from the national plan, as Alberta did years ago from the chicken plan. It makes the proper functioning of a national agency very difficult. We are not trying to destroy them, we are just trying to get a fair and equitable treatment for our producers on the question of overbase quota.

The member, later in his remarks, got into the question of the farm tax rebate program. I want to reiterate that the figures used to determine qualification for this benefit are gross production figures. They are not net. They are not the net income to the producer. They are the gross figures for the farm. They are in my view, and generally speaking in the view of most producers, reasonable.

I was pleased to hear the comments of the president of the Ontario Federation of Agriculture on the CFRB program, This Business of Farming, on the Sunday after the federation convention. They are obviously very pleased that we had settled that issue and, pursuant to their request of last July, revived it and introduced it for implementation in 1984.

There is no question that no matter what level one chooses there has to be a cutoff. Some are going to be below it while the majority will be above it. The $12,000 gross production figure, though, starting in 1984 for southern Ontario, is in my view a very fair and equitable sawoff. I may say too that we have been careful in drawing the lines. In 1982-83, the gross production figure for the whole of the province was $8,000. In 1984, it stays at $8,000 for eastern and northern Ontario and rises to $12,000 for southern Ontario.

We have drawn the line, basically through taking account of geography and factors noted in the original Treasury document about the size and style of operation in eastern and northern Ontario, so that the line will be drawn between the region of Durham and the counties of Northumberland, Peterborough, Victoria-Haliburton then swinging up and including Muskoka in the north.

Mr. Swart: There is always a fine line, but you've drawn a time line in the wrong place.

Hon. Mr. Timbrell: I will come to that. The amount of money which is going out under the program continues to grow this year over last, next year over this, and certainly in 1984 it is estimated that our expenditures under the program will be $85 million compared to our estimated expenditures in this current fiscal year of $63 million. That is a very significant increase. It is better than one third.

Mr. Swart: Above this year and next year?

Hon. Mr. Timbrell: This year it is estimated at $63 million.

The Acting Chairman (Mr. Piché): Never mind the interjections.

Hon. Mr. Timbrell: Yes, Mr. Chairman. The member for Huron-Middlesex raised a concern about the matter of the distribution of milk and the licensing of independent distributors for the trucking of milk. This is an issue which will soon celebrate its 50th anniversary. Apparently the 1934 Milk Act introduced the concept of distribution areas and the licensing of distributors within those areas.

For the edification of the House, basically we are talking about several different kinds of licences. There are the processor-distributors, which would be those dairies that process and distribute; there are the licensed distributors, which should be companies that make arrangements with the larger dairies like Silverwood, Beatrice, or one of those to buy their product and distribute it in their vehicles in certain areas; and then there are the unlicensed distributors, the agent distributors, who are the concern of the honourable member opposite and a number of other people.

8:30 p.m.

The act has essentially remained unchanged since 1967. One hears from time to time that there are quite a large number of these agent distributors, or unlicensed distributors, around the province. When I spoke to the annual meeting of the Ontario Dairy Council last week I told them that I have this matter under review. I also told them that as a matter of principle or philosophy, whatever, I do not believe in regulation for the sake of regulation; I do not believe in more regulation for the sake of more regulation; if anything, I believe in less regulation in trying to straighten out the relationship of government to various elements of the private sector. I indicated to them that I do have the matter under review.

Essentially our options are fairly clear. We can do nothing, that is not move to license these agent distributors; and depending on whom you talk to, they will tell you that there are several hundred or 300 of them in various parts of the province. Do not forget that all of the major dairies, I am told, have distribution rights to all of the distribution areas in southern Ontario. There are, as I recall, 10 distribution areas in the province, nine in southern Ontario, and all the major dairies have rights in all nine of them.

Our second option would be to move immediately to license them and to limit further competition in those areas.

A third option, if you go to the other extreme, would be to do away with the distribution areas altogether. Frankly, I am taking a fairly open- minded approach in looking at the question, and I am asking my staff to approach it with one basic question in mind: Is the public interest served through the continued existence of these distribution areas and the continued licensing of any milk distributor? If it is, fine; then there is the option. If it is not, it opens up other options.

So I expect early in the new year, after having completed our internal review and after having discussed the matter with my caucus and my cabinet colleagues, to indicate what, if anything, we will be doing on that.

Later on Friday, I believe, the member for Welland-Thorold got into the question of bankruptcies, whether they are increasing and whether or not the majority of those who are going out of business are younger farmers. I do not know if he was in the House earlier in the day. I was telling the members of the committee that figures from surveys we have done on real estate transfers in recent years, 1979 and 1980, indicate that in the typical year about six per cent of the farms in the province change hands. That does not seem to be an inordinate number given retirement or changes in lifestyle.

In a normal year we would expect close to 5,000 farms to change hands, of which about 1,000 per year are new farmers. In some cases those would be father to son, father to daughter, or parents to children transfers. In others, they would be buying out the assets of unrelated farmers who want to retire for whatever reason. It has been reliably estimated by my staff there are about 1,500 new farmers on the scene each year in Ontario.

Looking at our farm adjustment assistance program we have surveyed those applications we have approved to date and 80 per cent of the more than 3,000 cases to date are under the age of 45. Looking at all of Ontario farms, the last census revealed that 41 per cent of our farmers are under age 45. I do not think that disparity should surprise us. We have noted all along that the farm adjustment assistance program would be of particular assistance to recent entrants who have had to deal with the high interest rates prevalent in the country in recent years.

Mr. Swart: What about bankruptcies? Have you done a survey of the bankruptcies to determine the average age of those farmers?

Hon. Mr. Timbrell: No, there is no such registry where we could do that. I just wanted to point out to you that while there have been 145 bankruptcies to the end of October in Ontario, if this year is typical of recent years there will be about 5,000 farms change hands and about 1,500 will represent new farmers.

Mr. Swart: That is a different issue entirely.

Hon. Mr. Timbrell: With respect, that is a related issue.

Mr. Swart: Related, but certainly a different one.

Hon. Mr. Timbrell: It is a very strongly related issue. I know from --

Mr. Cassidy: For every bankrupt farmer there are 10 who get out because they can't afford to stay in.

Hon. Mr. Timbrell: You do not know that. You do not know from nothing when it comes to this. We have been having a very intelligent conversation about agriculture and --

Mr. McClellan: It is a monologue.

Mr. Cassidy: It has been a monologue. It is altogether too calm. There is a crisis over there. I don't notice any reaction on your part. Look at the crisis over there.

Mr. Swart: Don't say there are not 10 going out of business. Look at what the Ontario Federation of Agriculture says. It says there are 10 to 20 for every one that goes bankrupt.

Hon. Mr. Timbrell: No one is suggesting for a moment that there are not people who are going out of business.

Obviously the honourable member does not want in any way to give any credit where credit is due for the efforts of the ministry to support those who can remain viable with assistance under that program.

That is fine; that is his job as a member of the opposition to dismiss whatever the government does, no matter how good it is, as being irrelevant to him.

Mr. Swart: That verifies my concerns.

Hon. Mr. Timbrell: No, it certainly does not verify it at all. We have 1,500 new farmers each year in Ontario. It is true that no surveys have been done of the 145 to date this year who have gone into bankruptcy --

Mr. Swart: But 80 per cent of those you have had to fund to stay there.

Hon. Mr. Timbrell: That was a very strong reason for starting this program. We recognized that those who have started into farming in the last five years, with inflated land values, higher interest rates and a number of things against them, as compared to people who have been in farming for 20 or 25 years, are going to have difficulty.

I recognize that you are not about to give any credit for that but those are the facts. That is why we started this. If you talk to them you will find that they realize the benefit of the program.

Mr. Swart: It is not enough, it is a drop in the bucket.

Hon. Mr. Timbrell: I would be glad to listen to some specifics about how you would bring farmers more and more under the heel of the New Democratic Party government as you have done out west, which led to the defeat of two NDP governments in the last five years out there. It might well be time to tell that story again about M. J. Coldwell, but I will save that for later.

8:40 p.m.

Mr. Wildman: What happened to Sterling Lyon out there?

Hon. Mr. Timbrell: It was not over farm issues, if you look at the vote in the rural areas.

Mr. Swart: Just over his overall program.

Hon. Mr. Timbrell: It was not over farm issues. Look at the rural areas.

Mr. Swart: General incompetency is the word.

Mr. McClellan: You are interrupting Dennis's conversation with himself.

Hon. Mr. Timbrell: Well, I think people who are interested in agriculture are listening. You may just be filling your seat tonight; I do not know. But those who are interested are listening.

Mr. Cassidy: I think a lot of farmers would be appalled by your complacency, this mild tone of everything for the best in this best of all possible worlds.

The Acting Chairman: Order, please. Order.

Mr. Cassidy: That's what he is saying, Mr. Chairman.

Hon. Mr. Timbrell: Mr. Chairman, I remember very well when I sat on that side of the House years ago, as a back-bencher in the back row of the rump, listening to mighty Casey from Ottawa constantly striking out; things really have not changed.

There are a number of details, financial matters, which the member turned to with respect to comparing net real incomes from one province to another. He cited the July crop and livestock report to the effect that Ontario net farm income will drop to $655 million, claiming the dip is greater than in any other province. I am not for a moment happy about the decline, but the fact is that in relative terms it compares reasonably well with the rest of the country.

Earlier in the day I mentioned that the estimates that have recently been released for the United States were something on the order of a 25 per cent overall decline. Canada is around 17 per cent overall. It serves to highlight again the need for an improved stabilization in the country.

Mr. Swart: On a point of order, Mr. Chairman: I would like to correct the minister. I did not compare it with the fall in income of other provinces. Perhaps you had better check Hansard. I related it only to the interest on the indebtedness being paid by the farmers of this province. I pointed out that this year they will pay more interest than they will have net income.

Hon. Mr. Timbrell: With respect, I was going to come to that. I think that was a different point. We will both check, I guess. I thought you had in fact compared it with other provinces, such as Prince Edward Island, where net income is down 40 per cent; Saskatchewan, where it is down 36 per cent; or Manitoba, where it is down 24 per cent.

Mr. Swart: The only thing I compared to other provinces was the paucity of your assistance to agriculture.

Hon. Mr. Timbrell: Well, that does not include any of the programs the government has to assist agriculture, whether it is the farm tax rebate program or the farm assistance program or whatever, that is not included. If you inject those figures, it would change the picture considerably.

Mr. Philip: I hope the Chairman recognizes that the minister has spoken for two hours and hasn't mentioned STOL once.

Hon. Mr. Timbrell: Hasn't mentioned what?

Mr. Philip: STOL.

Hon. Mr. Timbrell: STOL?

Mr. Philip: STOL aircraft for René Piché's riding.

Hon. Mr. Timbrell: Oh, sorry.

Mr. Wildman: The Chairman is most interested.

Hon. Mr. Timbrell: Yes. Earlier on I think we dealt with the matter of long-term credit and the involvement by the Farm Credit Corp. in the various provinces. I think we have discussed that several times. There is no question, as we mentioned earlier, that over the course of the 1970s we saw the share of the long-term credit field carried by the Farm Credit Corp. diminish significantly from about 75 per cent to 25 per cent. The federal minister is trying to turn that around. We certainly encourage him in his efforts to go to the market and to obtain more funds for the Farm Credit Corp. through the new legislation he introduced in the spring of this year.

I think we covered the other issues in the main earlier this afternoon. I mentioned the increase in farm tax reduction. Most of these items only serve to highlight the need for the improved stabilization policies we have talked about so many times and which are strongly supported by the producer organizations.

I noted at the recent annual meeting of the federation that the president made very plain where the federation stands and where he stands in support of the policy we are pursuing and are attempting to develop with the federal government and the national producer organizations.

I want to emphasize, as I did earlier in the day in answer to an interjection by the member for Welland-Thorold, that the intent of this program is that it be of a nonincentive nature, that it not encourage overproduction or unnecessary production, because that would just guarantee further headaches or further disasters, and that it be of a voluntary nature. We are not trying to impose this. I have heard from some producers around the province who say, "We do not want anything to do with your stabilization programs."

It amazes me to hear, as I have heard, some producers say, "We do not want anything to do with your crop insurance program." Even given what happened this year with tobacco in southwestern Ontario, there are still some producers who, as a matter of principle, will have nothing to do with any program in which the government is involved in any way, shape or form. That is their choice. We would not want to force them into this stabilization program we are proposing. It will be entirely voluntary.

As I look through later issues raised by the honourable member, there are a number of things we can get into in the votes and items, but I would like to take a minute to deal with the question of imports and exports.

We would agree that one of our top priorities has to be to improve our share of our own domestic market as a more solid base on which to build. At the same time, however, I am sure the member would recognize there are not only significant opportunities for sales abroad but, if anything, as I have tried to indicate in several speeches I have made in recent months, as one of only four countries in the world which is in a position not only to feed itself but to generate surpluses, we have a responsibility to the rest of the world as well. That responsibility is literally growing daily with the number of people who are starving on this planet.

We think we have made some significant inroads. That is not to say there is not a lot more to be done because there is in the area of import displacement. A number of the projects I have announced this year are aimed at displacing imports: the tomato paste projects at Heinz and Primo, the strawberry projects, the asparagus projects, any number of things like that.

8:50 p.m.

At the same time we also have been able to increase our exports. This year to date we have noticed our imports are down about five per cent. Some of that is due to the continuing success of the Foodland Ontario program promoting domestic products. Some of it undoubtedly is due to currency changes and various other things, but I think the Foodland Ontario program is something we have to update continually. We are taking a look at that to make sure it is current, relevant, attractive and that it does get the message home to the consuming public there is benefit to themselves as well as to our domestic producers and processors in consuming Ontario products as opposed to importing.

At the same time we are trying to find more export markets. While our imports are down five per cent this year, to date our exports are up five per cent. While in 1981 we finished the year with a trade deficit of about $900 million in food, this year it will be down to about $700 million. This is still not satisfactory but it is going in the right direction.

In the reorganization of the ministry we have tried to give added emphasis to the marketing area through staff and money reordered from other parts of the ministry.

The member wanted me to deal with the matter of canola. I had no idea it was of such interest to him. Apparently a year ago there was a great deal of interest in canola as an alternative crop and this interest still exists.

The acreage of spring canola is increasing, but we are still anticipating there will be only a few thousand acres planted next spring. A canola workshop is scheduled for December 15 at Guelph to discuss various aspects of the production of this crop. Apparently, much of the enthusiasm was in respect to fall canola because of its much higher yield potential per acre. The researchers at the University of Guelph are now in their third season of testing, screening and developing fall-seeded varieties for our conditions.

Last year the results were not particularly encouraging. Severe winter conditions in southern Ontario caused failures. However, several test sites are again seeded for this winter. If a fall variety can be developed the economics of canola will be greatly improved. Our researchers are working to provide a suitable variety for our producers.

We have managed to reduce our deficit in soybeans and soybean oil, cake and meal: we are in a surplus situation for soybean oil. Our net deficit picture in soybean and soybean products has been reduced 30 per cent in just the last two years.

Within the last five years, new short-season varieties of soybeans have been developed for Ontario by the University of Guelph researchers. While I am on it, I might just say we have to be impressed with the results of the research work at Guelph related to that over the years. It really is one of the best investments we make. It has been estimated for every dollar of the $30 million a year we put into research through the ministry, we get a $40-million return.

These new short-season varieties I just referred to were quickly adopted by farmers right across the south of the province. The acreage of soybeans depends very much on the economics of producing the crop; the decision by farmers as to whether to plant corn or soybeans depends on their relative economics, the weather and the grower's preference.

We became self-sufficient in grain when corn became more profitable and the acreages increased rapidly. A lot of that, of course, was also due to tile drainage. We do not have unlimited areas and frequently one crop is substituted in the rotation for another crop which is preferred by the producers. We do now have the varieties, the technology and the marketing system to handle soybeans. The 1982 production estimates, as of today, are for 856.000 metric tons, which is up 41 per cent from the 606,800 metric tons for last year, 1981. The production in 1980 was 689,000 metric tons. As you can see, the trend is certainly upwards with respect to that crop.

Mr. Chairman, that concludes my brief response -- I did not use it all -- to matters raised by members opposite.

Before we get into the vote and item discussion, I wonder if the members would agree, under standing order 8(h), that I might occupy one of the seats in the first row and have some of the members of my staff join me on the floor of the House?

Mr. Chairman: Do we have agreement?

Mr. Riddell: Agreed.

Mr. Chairman: Well, moving right along, are we going to work into vote 1901? Is that the wish of the members of the committee?

Mr. Riddell: Are we going to consider the whole vote? Can we discuss all the matters under vote 1901, or are we going to go item by item?

Mr. Chairman: I would prefer to go to the whole vote. That way it allows some latitude. Is that all right with the member for Welland-Thorold?

Mr. Swart: Yes. Mr. Chairman, I would be prepared to go even further. As has been done in many of the other estimates, after we give our leadoff speeches we then move into the next vote, which would be vote 1902. Under vote 1902 we could cover, or at least I can cover, all the items that I want to cover and to ask questions about.

If the member for Huron-Middlesex prefers to deal with more of these items under vote 1901, I will not object to that, but I think we can more expeditiously deal with them all under votes 1902 or 1903 and that we could carry vote 1901.

Mr. Chairman: Do you have any other comments about vote 1901?

Mr. Riddell: I certainly do have something to say under vote 1901 when it comes to policies and priorities. I do not think we need to spend a great deal of time on it if the member for Welland-Thorold wants to move on to the other votes, but I certainly do want to spend a little time on vote 1901.

Mr. Swart: Okay.

Mr. Chairman: We should ask the minister. We might as well get -- it does not matter? All right. Let us plug away at vote 1901. We will have the vote and get into 1902 later.

On vote 1901, ministry administration program:

Mr. Riddell: Mr. Chairman, we have certainly established new policy in this year's estimates inasmuch as out of the 20 hours allocated we have spent nine on the opening statements by the minister, by myself, representing the official opposition, by the member for Welland-Thorold and in the response to those opening statements by the minister. It is certainly an innovation since I have been in this Legislature.

I must compliment the minister on having gained a fair grasp of the ministry and the agricultural industry in the short time that he has been serving in that portfolio. I personally feel the present minister has brought a higher profile to the Agriculture and Food ministry than we have had for some period of time. The fact that he has reorganized his ministry has given Agriculture and Food a much higher profile, but it remains to be seen how that will work out as time goes on.

9 p.m.

There are two items I wish to mention under new policies in connection with this ministry. First, I really feel the priority that has to be given this year and next year will be that of trying to keep the farmers on the farm.

The minister is not as concerned as he should be about the present trends, the confusion there is going to be in the farming industry and the terrible times we are heading for. I am very concerned about the number of bankruptcies we are going to see by spring of next year. I have talked to a good many farmers and others who say that 1984 is going to be even worse and that it is going to take us a long time before we pull out of this present economic slump.

I wonder whether the minister should not be giving some serious consideration to putting a moratorium on farm bankruptcies. I believe that when the farmers go to apply for their operating capital next year, and I am basing it on what is happening now, the bankers are going to ask to see the last two years' financial statements. They are going to see where the farmers have taken a loss, particularly this year with the prices of practically every commodity below operating costs.

I am not talking about commodities that fall within the jurisdiction of a marketing board that is able to set the price. I think the dairy producer is able to show a profit. The chicken, turkey and egg producers are not in the difficulties of those farmers who do not have the assistance of marketing boards.

I am being called to all kinds of farmers' places to see whether there is anything I can do to keep them from going bankrupt. Bankers are calling their loans. I was out to one the other day where the chap has a 38 per cent equity in his farm business. The only indebtedness he has to the bank is a $25,000 operating loan. I went in to talk to the bank manager and for some reason that boggles my mind he simply said, "You realize there is a degree of confidentiality between the farmer and myself."

There was nothing I could say, although I knew the farmer's business. I spent two hours talking to him and his father and they told me everything, giving me all the information I ever needed. I found I was in the position of giving this information to the bank manager, yet he could not tell me why he was calling the farmer's note nor could he tell me why he refused to send the farmer's application to the provincial committee.

The farmer applied for assistance under the Ontario farm adjustment assistance program and it never got off the bank manager's desk. I looked into it and made this suggestion: "Forget about the bank manager. Go to the chap from the agricultural representatives office; see if he will complete the application and have him submit it. Let us bypass the bank manager and see what will happen." That is what he did. The assistant ag rep, I guess it was, came out to his farm, sat down and they made out an application. I believe they submitted it without the assistance of the bank manager because he was not prepared to co-operate.

I could go on and tell the minister about all kinds of incidents where the bank managers are not going to co-operate with the farmers either by way of sending in applications for OFAAP or showing a little leniency, trying to do all they can to help keep farmers in business.

This spring we are going to see farmer after farmer go under simply because they cannot get any more assistance from the bank or from OFAAP. The reason is that there are probably too many restrictions in the program, one of the restrictions being that the financing cost has to amount to 20 per cent of the operating cost. This is catching quite a number of farmers. according to the information I am being given.

Second, the interest assistance does not apply to the other two categories of the program. Although the minister tried to explain why he was not prepared to give interest rate assistance to the new line of credit category, or category C, he did not indicate why he would not be prepared to give interest rate assistance to category A or the deferred interest part of that program. I go back to a release from the Ontario Federation of Agriculture, and I quote:

"The OFA has repeatedly stated that the restrictions on the Ontario farm adjustment assistance program make it less effective than it could be. We have agreed that both interest deferral, part A and the guaranteed new line of credit, part C, options must also be eligible for interest subsidy, or else the farmer who applies for assistance under the program is restricted in his financial planning and in fact realizes less benefit.

"Figures released recently by the Ministry of Agriculture and Food provide a statistical base for assessment of the program."

There are a few figures here. I will not quote them, because I do not think they are all that relevant right now.

This is from Ralph Barrie, president of the Ontario Federation of Agriculture, and he goes on to say:

"Statistics show that producers showed little interest in the interest deferral program. The reason, of course, is that principal on which interest is deferred for six months does not qualify for the five per cent subsidy. Yet, in our opinion, many producers could profitably use interest deferral as an enlightened way in which to plan their financial affairs to increase their cash flows significantly for six months.

"Consider a producer who has a debt of $200,000 at a floating interest rate of 18 per cent. If he could defer interest for six months, his cash flow will improve by $3,000 a month during those six months for a total of $18,000. If he is a cash-crop farmer, he will be able to realize on the sale of his crop at the end of six months and pay off the deferred interest. By opting for the interest subsidy program part B, he improves his cash flow by only $833 a month for a total of $5,000 in six months.

"The difference, of course, is that under the subsidy program he does not have to pay back the $5,000 at the end of six months. In fact, he will receive another $5,000 in subsidy in the whole 12-month period. But if the principal on which he is allowed the deferred interest, part A, was made eligible for a five per cent subsidy, then he would likely choose the former interest deferral with subsidy. By so doing, he would not only get the benefit of a lower interest rate but also be able to increase his cash flow when he needs it most. Yet making part A eligible for the interest subsidy would not cost the government a penny more, because at present nobody is availing himself of the interest-deferral part A program.

"OFA has consistently stated that the guaranteed new line of credit, part C, must also be eligible for interest subsidy. The statistics to date show that the amount authorized under part C is roughly 10 per cent of the amount authorized for interest subsidy, part B. It is likely that this portion would increase in the coming months. However, our assessment is that amounts under part C will not exceed 20 per cent of amounts under part B. By extending subsidy eligibility to part C, the maximum increase in cost to the government will be 20 per cent. At the same time, the government might significantly reduce the risk of making payments on the guarantees. Fewer producers will go bankrupt if they receive subsidy on the new line of credit."

That is really the bottom line: to try to prevent more farmers from going into bankruptcy. I agree there are going to be some farmers for whom it does not matter what kind of program the minister introduces, he is not going to help. This could be a shot in the arm to deaden the pain, but they are going to go.

9:10 p.m.

I think the minister indicated that six per cent of the farmers, for whatever reasons, sell their businesses. They are the farmers who were persuaded by this government, back a number of years when there was a committee set up by, I believe Bill Stewart, the Minister of Agriculture and Food at the time. The report which the committee submitted was called the Challenge of Abundance. If the minister reads through that report, he will see where the committee was recommending that farmers get bigger and more efficient or get out of the business.

A lot of our farmers followed that advice, encouraged by the government in some of its programs, and they did get bigger and more efficient; but it has taken a lot of money to do that. Now that we are going through tough times, it is some of these very farmers who are now in trouble.

I worked with these farmers when I had my own livestock sales business. I got to know practically all the farmers in Huron county. I know it is some of the good ones who are in trouble. They are some of the ones I brought to the minister's attention. Some of them cannot be saved because they got in too deeply.

The reason they got in, again, was because they were encouraged not only by the government but also by the banks. When they went in to borrow money from the bank manager, the manager said: "I see no reason why I can't give you this amount of money. But why don't you take so much more and really get yourself set up? Put in a liquid manure tank or something of that nature."

The farmer never asked for it in the first place. He went in maybe to put up a new hog barn, but he was not particularly interested in going to slatted floors, liquid manure and all the rest of it; but the bank manager talked him into it. Now he finds that he has such high overhead he cannot make a go of it with the high interest rates, the high input costs and the low prices he is receiving for his products.

What I am saying is that if it appears we are going to lose quite a number of farmers in the spring, that they are not going to get the assistance they need from the Ontario farm adjustment assistance program -- and they have nowhere else to turn -- will the minister consider a moratorium at that stage? Will he consider lifting some of the restrictions on OFAAP, now that he has extended it one year, to make it a more effective program for those farmers? That is all they have to rely on, because obviously the minister is not going to come in with any new programs.

For some reason he has put the young farmers' credit program on the back burner. I know he is hanging his hat on the tripartite stabilization program which he thinks is going to be the saviour of the farmers in the province, and in Canada for that matter. But as I have indicated in my interjections, the other provinces are not waiting to see whether the federal minister is going to go along with the tripartite program.

Saskatchewan has just announced a major mortgage credit program for its farmers. The province lowered interest rates in Saskatchewan to half that paid by most Ontario farmers. Saskatchewan farmers will be offered up to $350,000 each at eight per cent interest. That is $50,000 more than the top limit under the federal government's Farm Credit Corp. and compares with 15.75 per cent the FCC is charging.

I am simply saying that the other provinces are doing something to keep their farmers on the land. I do not feel that OFAAP is going to do it. I really have more concerns about what we are going to see in the next year or two than the minister does, I am sure of it. I am simply going by the comments he made in responding to some of our statements.

Hon. Mr. Timbrell: Mr. Chairman, I wonder if I could deal with that subject before the honourable member goes on to something else.

With respect, I think the member would have to look back over the course of this year regarding the comments he has made himself and the reactions I made to them. I think he would have to acknowledge that a great many of the things he indicated to me in the spring of this year were going to happen did not happen.

It is not a matter of who is more concerned. I am assuming, from the outset, that we are equally concerned, on both sides of the House, that we do everything possible to help producers who can be viable to remain in business. I know the member is realistic enough -- he has indicated as much -- to acknowledge that in some cases nothing we do will help them and that, if anything, we would be better to try to find some ways to help them in an orderly way to make a transition to some other business.

With respect, a lot of predictions were made in the spring of this year about what was going to happen. We were confident over here that those predictions were incorrect and that we had put a program in place that could deal with the needs of agriculture. As it turned out, that has been the case.

I do not like to come back to it so often, but we did not have this stabilization policy in place to give support, particularly for the cash crops which have suffered so badly this year. I do not apologize for giving that policy a great deal of priority. I really do believe, and I think the member opposite believes, that it is important for the long-term stability of agriculture to put that kind of program in place.

The member has referred to the lenders' decisions, and I think I referred to that earlier today. I am sure that if the lenders over the past five or 10 years had been using the kind of criteria we have been using through the farm assistance program, there are any number of loans that would not have been made. But I do not think that is isolated to agriculture. Unfortunately, it is typical of the 1970s and of the attitudes of the lenders with respect to business and their expectations for the economy, which have not been fulfilled in recent years.

The options under the program were very carefully drawn, aimed at specific types of problems. Option B is the one that was expected to be most attractive to most farmers, and that has been borne out by the figures to date, the fact that we have approved interest rate rebates on operating loans in excess of $600 million. Option C, as I explained earlier in the day, was intended primarily to entice lenders to stay with their clients. And there are any number of cases where options B and C have been mixed, where they have gotten an interest rate rebate on outstanding accumulated operating debt.

The lenders have been encouraged, enticed or persuaded to stay with their clients by way of a guaranteed new line of credit, which is at prime. That is still a good deal. Admittedly it does not involve a rebate, except I point out that some of the outstanding operating debt is well above current prime. The rebate was up to five points on that debt down to as low as 12 per cent. So I think I could argue that guaranteeing new lines at prime is tantamount to a subsidy compared to what it would have cost without that guarantee being involved.

As for a moratorium, I can certainly understand the sentiment behind it. I just think we have to find ways to work our way out of it short of a moratorium. And if we are going to have a moratorium, I do not think we can do it on a province-by-province basis; it would have to be done nationally. In fact. there is a bill that has been presented from time to time b the member for Lambton-Middlesex in the House of Commons on that.

I am under no illusion that we have to watch this on at least a monthly basis to see where the trends are leading us and whether we need to broaden existing policies or adopt new policies in 1983. But I think we are on the same wavelength in that we want to give some help to the individual producer who can be viable to get over this period. I think the implications of a moratorium are much broader than the member may think.

9:20 p.m.

In terms of the long-term availability of credit, we have been able to work effectively with the lenders in this province. Some applications for the farm assistance program have been turned down, but not a lot. That low rejection rate does not indicate the program is a giveaway program but, rather, that before a proposal comes in it has been thoroughly worked over and discussed with the lender, the applicant, the local ag rep and whoever else was needed at the local level before it went to a local decision committee and from there to the provincial decision committee.

Mr. Riddell: Mr. Chairman, I guess we in the opposition are really asking the minister to give us some assurance that he will trigger a program if it appears within the next year that OFAAP is not going to do the job and many of our farmers are going to go into bankruptcy.

The minister talks about OFAAP doing such a wonderful job over the last year. We know it has helped about 3,000 farmers, but neither the minister nor I know how many farmers have gone into bankruptcy or how many other farmers have been forced to sell their farms before they reach that point. What we really do not know is how many more farmers could have been helped by some kind of program but, owing to the fact they could not qualify for OFAAP and had nowhere else to go, they either went into bankruptcy or sold their businesses.

Hon. Mr. Timbrell: Mr. Chairman, I hope we may be a little more open in exchange. With respect, we broadened the criteria back in March. The original criterion for getting into it was with 10 per cent to 50 per cent equity. We have broadened that to 60 per cent. We have even approved a dozen cases below 10 per cent equity where it could be shown there was a glimmer of hope. We reduced the gross production criterion from 525,000 to 512,000.

As I have said before on this question during question period, how much broader would the member make the criteria? I do not think the 20 per cent requirement with respect to debt load is unreasonable. This program was never intended to be the financing vehicle for every farmer in the province; it was intended to be targeted. One can go right back to the point where the task force report was written. They said there were individuals who should be helped. We agreed and accepted that proposal.

At present, interest rates have come down substantially. Obviously, as we go into 1983, we do not know what is going to happen during that calendar year with interest rates, whether they will stay down, in which case a number of these problems will be sorted out by virtue of that, or whether they are going to go back up again.

If we find the farm assistance program is not doing the job it did in 1982, which we figure it can continue to do in 1983, then it would not be like us to sit back and ignore it. We would have to take stock and where necessary make changes in direction. We are going to keep pushing through 1983 to get that stabilization program in place.

Mr. Chairman: I see the member for Welland-Thorold is dying to do something. I do not know whether he wants to get in on this.

Mr. Swart: Yes, Mr. Chairman, I want to get in on this issue. I presume we are going to be discussing this matter again under vote 1902, item 4, financial assistance to agriculture. I did want to make a few comments under this section, although pretty well everything could be covered under vote 1902.

When I see the minister standing up there with his arms folded, I think he looks as though he is getting the posture of the member for Brampton (Mr. Davis), the existing Premier.

Mr. Cassidy: He is assuming the mantle.

Mr. Swart: He is even going in that direction in trying to assume the mantle of the member for Brampton.

I am not going to deal with all the financial matters I want to deal with, because I think they come under vote 1902, but there were some general comments made by the minister that I want to respond to.

The minister scared me when he indicated, if I heard him correctly, that 80 per cent of those 3,000-plus who have received assistance under the interest rebate program are 45 years of age and under. Surely that indicates as clearly as anything could that farmers in that age group are having the greatest problems.

I do not know whether the minister has statistics with him for those to whom he is giving the guarantee under the deferment; if he has, I hope he will give them to us. But when 80 per cent of those who are receiving it -- and they are really in the most crucial situation except for those who have gone bankrupt and gone out of business -- are under 45 years of age, that is a pretty serious situation.

I do not doubt the validity of those statements. All of us, including the member for Huron-Middlesex, know that farmers who have their farms paid for, the older farmers by and large, and many of the younger farmers who have inherited farms from their parents, are getting by. But those young farmers who have gone into business in the past five, 10 or 15 years, and did not have a great deal of capital to start with, are in a desperate situation. I think we have to recognize this. It adds to the demand for a very close watch and for much more assistance to be given to those younger farmers in particular who may find themselves on the verge of going bankrupt during the next six months.

I am a bit puzzled, too, why the minister cannot find out the status of those 145 who have gone bankrupt. If the federal Minister of Consumer and Corporate Affairs can tell us exactly how many in each province have gone bankrupt, does our Minister of Agriculture and Food not have access to that information? Can the minister not ask the federal minister so supply him with information in this regard?

It is important and fundamental to the whole argument of assistance to the farmers, because what we are looking at now and related to this whole argument if I did not misunderstand the minister, is that he stated the assistance went to four per cent of the farmers but that this four per cent represented 10 per cent of the agricultural production. I believe I am quoting him correctly.

What we have is that those farmers who are in jeopardy, and probably those who have gone bankrupt, are, number one, the younger farmers, and, number two, the larger farmers. Perhaps the most productive farmers are the ones who are in jeopardy. Surely this must give the minister some very real cause for concern when it is that class of farmer in great difficulty.

I do not express any surprise at that; it verifies what I have suspected. But it certainly gives impetus, as I see it, for financial assistance programs that will be meaningful and will prevent any large number of those farmers from going out of agricultural production.

I agree with the minister that any financial assistance he gives has to be given on a businesslike basis. If any government gives out money that promotes a nonviable operation, there is a danger to that and it is something none of us wants to do. But at present, and the minister must agree, the situation is abnormal.

9:30 p.m.

It is not a normal situation with which we are dealing. They are not poor farmers or poor businessmen, generally speaking. They are farmers who have had viable operations and still would have going concerns if it were not that interest rates have gone so high and now farm prices are dropping substantially; they have been caught in that twin squeeze.

All of us in this House want to ensure those farmers do not go under. If they do go under, it is not only going to be those farmers who will suffer, it is also going to be society in general. There is going to be a price to pay.

When I hear the minister talk about six per cent of the farms changing hands in any normal year, saying this in a nonchalant manner as though what is happening this year is normal too, it bothers me, because what is happening this year is not normal. Surely he must agree that the number of farmers who are in financial difficulties and who are going out of farm operations because of financial difficulties is many times what it was back three, four or five years ago. It is a whole different situation now to what it was at that time.

The minister will rise in indignation to disagree with me, as he did before, but there are some parts of his original statement that I like, at least with the proposals in writing for agricultural economic planning in the province. I feel good about those things because they are what would be called socialist measures.

Here is a government that is doing this economic planning for an agricultural society. If he could talk to the Minister of Industry and Trade (Mr. Walker) and have him set out an economic plan such as that for the whole province, and if he followed that plan and the minister of agriculture followed his, we would probably be in a far better position. But if the Minister of Industry and Trade takes the opposite position. This minister is establishing an overall agricultural policy and I commend him for it. Hopefully, one way or another he is going to ensure it is brought to fruition.

Mr. Wildman: It is the socialist fifth column, Duncan Allan, in the ministry.

Mr. Swart: Perhaps that is it.

Just to show how far he will go, I have an article from the London Free Press, dated April 2, 1982. The heading is "Timbrell to Get Prod Out if Needed." It reads in part: "Ontario's fledgling agricultural minister Dennis Timbrell said Thursday he does not intend to be dictatorial to the province's rich agriculture and food industry, but if he decides it should be taking a new direction, he implied he will wield a big stick.

"As an example, Timbrell told an informal meeting of the Eastern Canadian Farm Writers Association the government had to do some prodding to get industry to agree on setting up a tomato paste processing industry. Earlier this week, Timbrell announced a $3-million grant to a $15-million H. J. Heinz Co. tomato paste project to help replace $25 million in imports of paste each year. He said, 'We had to knock a few heads and twist a few arms to get a few of these industry guys to come to the table.'"

Boy, that is getting a handle on things. There is socialist direction and economic planning for the agricultural community. I commend him for it. That is all part of his overall program, a program on paper, for import replacement. I have to point out to the minister it is his Conservative government that has brought us to this situation. Over its well nigh 40 years of governing this province, it brought about the need for import replacement.

When those people came to power this province was self-sufficient in those goods we could produce. Whatever happened that we got to the point where we import something like 80 per cent of our peaches and peach products into this country? Yes, he has some responsibility to start us back in the other direction. I am glad to see he is at least talking about it.

Although he made some very disparaging remarks about my former leader here, the member for Ottawa-Centre (Mr. Cassidy) did more while he was leader to popularize the term "import replacement" than any other member of this Legislature. He talked about that constantly in this House and he talked about it in the agricultural community. He did more to promote that than any other member of this Legislature. I think the minister should be honest enough to give him credit for it.

I have one question under the ministry administration program, that is with regard to Experience '82. I do not say it is the most important issue we have put before this House, but I notice there was a reduction in the amount of money allocated to us this year compared with last year. It is not a major reduction, but if we take into consideration the fact that wages are slightly higher, I understand it is a fairly substantial reduction. I would have thought that with the needs of agriculture, the minister would have found places within his whole ministry to at least have kept up with the program they had last year. With the need for jobs for young people this year, that aspect would have enhanced it.

I wonder if he could give us the figures on the numbers employed and the length of time compared to the previous year and to the 1979-80 year. I think I will leave any further comments I may have to vote 1902, which is going to be dealing with both of these items individually.

Hon. Mr. Timbrell: Mr. Chairman, I want to respond briefly. I will get the member the figures on Experience '82. I do not have them here.

The member points to the figures I gave him of the fairly high percentage of those under the age of 45 who have been approved to date under the farm assistance program. He sounds as if that surprises him. Again, it was because of concern about the impact of high interest rates, and in recent years high land costs, on beginning farmers and younger farmers that the program was introduced. I suspect if there was a program of assistance to hardware dealers or real estate companies or whatever business sector we look at -- it would not matter -- we would find it would be the younger person in the business who is more highly leveraged.

The farming business tends to be somewhat unusual in that every generation it has to be recapitalized, particularly now as lifestyles have changed and people do not necessarily want to retire on the farm. More and more they want to retire earlier, they want to enjoy the same kind of retirement or lifestyle their peers are having --

Mr. Swart: You mean they want to be unemployed too?

Hon. Mr. Timbrell: I do not make light of that. I do not know why the member would.

Usually they want the same lifestyle as their peers, travelling and that sort of thing, which did not happen a generation ago. More and more there is the need for every generation to recapitalize that farm as the next generation buys it from the parents or from those who are retiring.

I do not know why that surprises the member. That is going to be true in any era of high interest rates; it is going to be the younger individuals in any business who are going to be the ones with the greatest problem. If we look at the housing market right now, those who are having most difficulty holding on to their homes are people like myself in the under-45 age group who have the higher mortgages in terms of the quantum and the higher rates of recent years.

9:40 p.m.

Mr. Swart: And the unemployed and those with no seniority.

Hon. Mr. Timbrell: That is the point. I do not know why it surprises the member. If anything, it should please him that we have been able to help as many as we have under this program.

Unless I misread my estimates book, we budgeted $839,500 for Experience '82 in 1982-83. Our 1981-82 estimates were $666,900. If he wants figures on the actual numbers employed, I will be happy to get them for him. I want to say, though, that one of the things I am particularly pleased with is the reaction I have heard as I have moved around the province and the reaction I have had in ridings from many farmers about the agricrews who have worked our Experience program. They have been extremely well received; it is a great experience. They are of meaningful benefit to the individual farmers who engage them to help with work on their farms. That is a program I hope he agrees should be retained, but I will get him the actual numbers.

The Acting Chairman (Mr. Robinson): Thank you. With 10 hours and 33 minutes, the member for Huron-Middlesex.

Mr. Riddell: I will not be long, Mr. Chairman, because I know my colleague the member for Haldimand-Norfolk (Mr. G. I. Miller) wants to get involved in this part of the debate too.

Another restricting factor in the Ontario farm adjustment assistance program is the 60 per cent equity. The minister alluded to it a few minutes ago and I want to pursue it before the member for Welland-Thorold gets started.

Farmers are telling me that the land values are based on the values which were used one, two and three years ago. The present land values are not used. We all know that in many cases land values in some areas of the province have been cut n half because of the economic slump we are in. If the minister is going to use land values based on those values of one or two years ago, they are going to go over the 60 per cent equity, but if we are to be more realistic and use today's land values, then they will fall within the 60 per cent equity and they will be eligible for the program. I want the minister to comment on that.

There is one last point I want to raise and then I am going to be quiet and let the other members carry the load for the rest of the night ii they want, and that pertains to the property tax rebate policy the minister announced at the Ontario Federation of Agriculture banquet.

I cannot say that I am speaking for a majority of the farmers. I know I am not going to be in tune with the OFA, if indeed they are supporting the minister on that program, but I am one farmer who does not believe that land should be exempted from tax or that the government should be rebating 100 per cent of the land tax. Farmers should be asked if they believe that their land should be taxed for services to land: in other words, as far as I am concerned, there should be a tax applied on land for hard services.

Let us face it, the farmers use the roads to get to and from the elevators, the co-ops, wherever they do business. If a tractor happens to catch fire, they rely on the fire department to come and put it out. If some of the straw catches fire in the field, they will phone the fire department to come to put out the fire. Why in the world should land not be taxed for hard services? Maybe it is my free enterprise nature, but I am one who thinks it is ludicrous to either exempt land from taxes or to be paying back 100 per cent to farmers on the land.

If a farmer goes into tax arrears, what is the municipality going to do? Is it going to take his house or the land or both? The farmers are going to be taxed on their houses but not on their land. In other words, the government is going to rebate 100 per cent of the taxes on the land. In effect, it would sound to me as if the municipality cannot touch the land if he goes into tax arrears because he has nothing to do with the taxes on the land. So the municipality comes along and says, "We are taking your house," That implies there has to be a separation, because the municipality cannot touch his land but can take his house away. I wonder if the minister has given this some consideration.

I wish he would rethink this whole business about rebating a farmer 100 per cent of his land tax. If the farmers stop to think about it they are not going to be happy, because they do not want to be considered different from any other businessman. Other businesses pay a tax. I am not saying I agree with business taxes, but the farmers do not want to be separated. They do not want people believing the government is doing all these great things for them or that it is paying all the taxes on their land.

A lot of the farmers are left with the impression: "I wonder if I do own the land in that event. If a trespasser comes across my land and I go out and say, 'I do not want you motor skiing or snowmobiling or hunting across my land,' and if I try to put that person off the land the person may just say, 'Listen, mister, are you paying the taxes on this land?'"

The farmer would have to say: "No. I guess I paid them initially, but then the government turns around and gives me 100 per cent of my taxes back." The hunter would then say: "Well then, mister, you do not have much say about your land, do you? The government is giving you all the taxes back on your land, so as far as I am concerned the government has control over your land. You take the matter to your government because I am not leaving your land. As far as I am concerned you do not own the land."

I know this is a myth. My response to farmers who bring this to me -- and there are all kinds of farmers who do -- is that if they want to find out who owns the land, to go into the registry office and ask who owns it. It is a bit of myth, feeling you do not own the land because the government rebates 100 per cent of your taxes.

Maybe I am talking only for myself, but I know there are other farmers who would agree with me it is wrong that a government should be rebating 100 per cent of the taxes. I think the land should still be taxed for those hard services. Then the farmer has some feeling there is a tax applying for the land to pay for the upkeep of the road he travels on and the fire and police services he gets.

I do not care what Ralph Barrie says nor what the Ontario Federation of Agriculture says. We have a few directors there who are calling the tune for the majority of farmers. If we were to take a trip down the back roads and talk to the farmers and ask them if they are happy with the government rebating 100 per cent of their land tax, I bet more farmers will say they disagree with that program than would say they agree with it.

The minister is going along with it because he knew that something had to be done. Going back to the days of the old Blair commission report, I believe they said they were going to exempt farm land from taxes and there was a big hue and cry amongst the farmers when that program was announced.

9:50 p.m.

Then they made a few amendments to it and they thought well, okay, we will have the farmers pay on 10 per cent of the land and the other 90 per cent will be exempt from tax. I believe it is something of that nature. The farmers still were not happy and there are farmers today who are not happy about the government rebating 100 per cent of their taxes.

The reason I know that is because I spent the weekend talking to farmers. I got telephone calls that I have to return, messages are on my desk right now and the little note at the bottom of the messages pertaining to the property tax rebate program says: 'We do not want the government rebating 100 per cent of our tax." They are not satisfied with that program. Maybe I am speaking on behalf of a minority of farmers but I do not think it is right either.

Another reason I do not think it is right is because I happen to know there are doctors and lawyers who own farm land. A very prominent lawyer in Goderich -- I will not tell you his name -- owns all kinds of farm land, farm land that does not have buildings on it. What are we doing? We are saying to those doctors and to those lawyers: "You do not have to pay any tax on this farm land because it is all going to be rebated to you." So they have a free ride. I do not think that is right. Neither do the farmers think it is right that the doctors and the lawyers should be getting a free ride because they happen to own land that does not include a farm house.

The minister scoffs. I do not understand why he does not see that point. To my way of thinking there is no way that doctors and lawyers should get away without paying some tax on the land they own but under your program they are not going to worry about one red cent of tax because it is all going to be rebated to them. So they have a house in the city and they are going to pay the taxes on the house just as the farmer is going to pay the tax on his house, but they can go scot-free on all this land they own. It is wrong; it is ludicrous. I really wish the minister would give this matter second thought before he comes in with a program whereby 100 per cent of the taxes are going to be rebated.

Surely some kind of program can be worked out whereby a farmer would be taxed on his land for services to that land, if we want to put it that way. I agree that the land should not be taxed for soft services, for services to people, and that is the reason we started the 50 per cent rebate, because the farmer found he was paying more than his share towards education by virtue of the fact that he owned all this land.

But we still have roads, fire departments and police service, or what we might call the hard services. I really think that the land should be taxed for those services and that the government should not rebate 100 per cent of the taxes. I just throw that out for the minister's consideration and now I am going to shut up and let him take the floor.

The Acting Chairman: With 10 hours and 21 minutes, I understand that there is agreement among the parties that we have nearly concluded vote 1901 and are prepared to move on. I do not know; but I will certainly recognize the minister.

Hon. Mr. Timbrell: Mr. Chairman, this is an item that has not come up earlier in the discussions. With respect, in listening to part of the member's remarks, I thought at some point I was at a Libertarian rally, because if he pursued that argument to a plausible conclusion any sort of government assistance or support of agriculture would fall into the same category he is describing.

Obviously, the land remains in the ownership of the individual. Nothing in our farm tax rebate program in any way, shape or form jeopardizes or compromises the title which they hold. Individuals who apply for this assistance would have to have paid their taxes on the land. That will not change. They will still pay their taxes to whichever township for that land and then apply for the full rebate on the productive land. I emphasize on the productive land and come back to that. They will have to show proof that they have paid their taxes.

So the member asks, "What will the municipalities do if somebody is in arrears?" The municipalities will do what they always do: They will attach interest on the outstanding balance. And if it gets too far gone, the municipality will move in. That will not change.

Mr. Riddell: What will they do? Will they sell the house? Will they sell the farm? Will they sell the whole thing?

Hon. Mr. Timbrell: If they are in arrears on both, then they can sell both; if they are in arrears in one part and not the other, that is what they will do. That relationship will not change. But the individual will have to apply for the rebate.

I do not know what the member has against doctors, lawyers or whatever. He has got at least a couple of lawyers in his own caucus; no doctors that I can recall. The policy is aimed at keeping productive farm land in production; whether a doctor owns it, a retired spinster or whoever, is immaterial.

The policy has certain gross production criteria, the member will recall, and as long as the land meets those criteria -- the land; I am not talking now about the applicant, whether the person is very wealthy or on a meagre income -- then they can apply and they qualify. We are not aiming to support doctors or lawyers; we are aiming to keep productive land in production, that is all.

The member says he thinks there should be some other system. We have explored any number of systems and concluded that the best way was in fact to rebate the full taxes on the productive land.

He is quite right, a few years ago when my friend Mr. Blair chaired a commission on taxation they talked about a full exemption, and I can fully understand why farmers would certainly be upset about that. I would not be very happy about it, either. There is something very important about maintaining that relationship:

"It's my land. I will pay the taxes on it, and then will apply."

If the member is returning any of these calls and they do not like the program, they do not have to apply. We are not automatically sending them cheques. If as a matter of principle they disagree with it, tell them not to apply. They also may not apply for the property tax credits, which would be available to them with their annual income tax return, on their homes and the land on which the homes stand. There are some people who do not apply for those because they disagree with them as a matter of principle, and I respect that. Nobody forces them to take it. They do not have to take it.

But we are not going to change their relationship to their municipality in any way. We are not going to reduce their right to control their own property. Again, if you pursued that to the nth degree, there are all kinds of senior citizens in this province who get extensive support with their property taxes. That does not mean they have to turn their property over to whoever comes along on the grounds that they as taxpayers have paid for part of it. That is ridiculous.

They have been identified as another group in society who for different reasons warrant support with respect to their property taxes, and they get it. The farmers are not in any less defensible a position with respect to the protection of their property, their livestock or their possessions as a result of this. So when the member talks with these individuals, I hope he will stress the facts to them. They may very well be under the impression that we are still talking about an exemption. We are not; we are talking about rebate.

The municipalities were just as concerned at the time this was discussed as individual farmers. Their concern was that if the province just exempted this whole class of land, then somehow it could be manipulated at a later date, that the province could fiddle with the grants. I do not blame them for that.

When I was Minister of Health we used to have a saying, that just because you are paranoid does not mean they are not after you. That is a quite popular concern, because ministers can change, administrations can change; and if there had been such a class exemption, perhaps those fears might some day have come to pass. So I understand that.

We have opted for a rebate program. It will be 100 per cent on the productive farm land. Farmers will also get a further break in that the land on which their homes sit will be assessed at 50 per cent of local prevailing value.

10 p.m.

The homes will be assessed on the same basis as other homes in the community. If the member is worried about doctors and lawyers having palatial country homes on these farms, they are going to pay for them and they are going to pay big. As long as the land is in production and meets the production criteria, that is our main concern.

Mr. Riddell: If you consider farming with horses to be making the best use of productive land, and considering that the sale of two colts for $12,000 would make the nonresident owner eligible for the tax rebate, then I say your program is misdirected.

The Acting Chairman: Has the minister concluded his remarks on this segment?

Hon. Mr. Timbrell: I want to deal with the last matter the member raised, the question of 60 per cent equity. In most of the cases I have heard of this year, they sat down with their lenders and did current appraisals of the assets with current land values. There have been cases where, because there have been some significant reductions in land values, the equity has dropped considerably compared to the accumulated debt load. I have heard of cases, and perhaps the member will describe more of them, where they have fought hard to keep the original assessed values included in the assessment of their net worth.

In most cases I have heard of they have used current land values. That has reduced a great many if not most, of the cases that have been considered below the 60 per cent figure. I have not heard many complaints that the figure is too low. We have both heard from men who think we should not be doing any of this. Maybe they do not think we should be doing anything about farm tax rebates of any kind either, but I do not find they approach a significant proportion.

Mr. G. I. Miller: Mr. Chairman --

The Acting Chairman: We have something of a quandary in the rotation. It should be the member for Welland-Thorold. In the normal course of events, I would have recognized the member for Haldimand-Norfolk. In maintaining the rotation, I will recognize the member for Welland-Thorold.

Mr. Swart: Mr. Chairman, I am going to speak on this particular issue. I had not intended to speak. In view of the fact you allowed considerable discussion, it is important for me to comment on it and put the position of our party on this.

We fully support the proposed property tax exemption on land that is used for agricultural purposes. I have fault to find with the way the minister is introducing it. He is taking something away before he is giving anything. That promise is two years down the road. It is promised for this year, but it could be taken away next year or the year after. What he is doing immediately this year is raising that exemption to $8,000. What is happening is, before the farmers get any additional benefits, something is taken away from them.

Though I may not disagree fundamentally with the principle behind the higher exemption, I totally disagree with the way it is being done. The minister starts that one this year and two years hence he is going to give the additional money, or so he says now. But we have to remember that last spring we had a promise in the budget, and prior to that time, for the young farmers credit program, which has not materialized.

I object to taking something away right now. There is the saying, "A bird in the hand is worth two in the bush." The bird in the hand this time is a bird that is pecking away some of the farmers' income. The bird in the bush is two years down the road which is going to provide some additional assistance to the farmers.

In support of this program, as the minister has said and I agree with him, I do not see anything wrong with the principle we have in this province now. I presume many of our senior citizens, perhaps the majority, pay no net taxes on their property. I do not think any of them feel their property is in jeopardy because of that.

There is something that bothers me most of all about the position of the member for Huron- Middlesex. I guess I am not surprised when he comes out in favour of high interest rates for farmers. We are not surprised to have him come out in opposition to the removal of the property tax on agricultural land.

But what is taking place at the present time is so unjust -- getting a straight 50 per cent tax reduction on all buildings including the home, as long as there is $5,000 of agricultural production there. We have quite a number of cases in the Niagara Peninsula where some of the homes are worth $150,000 or $250,000. They are not all owned by the doctors or lawyers that you talk about, either. A businessman who used to be a famous hockey player has a home that is worth, I suppose, a third of a million dollars. He has farm production in the amount of $10,000 on this farm. So he would get a tax rebate on the house too; 50 per cent across the board.

With the new program at least they will pay the tax on that house, the same as if the primary use of that land was for the building of the house and any farm production was only incidental. There is a major improvement in fairness here, where the rebate is actually going to be for the agricultural land, not for the building, and that seems to concern the member for Huron- Middlesex.

So the program itself is sound but the sneaky kind of way it is being done is what I object to -- taking something out of the farmers' pockets on the promise that at some later date you are going to put some money back in.

Mr. Riddell: Mr. Chairman, on a point of order: I should not be bothered getting up to try to correct the record --

The Acting Chairman: Make sure it is a point of order then.

Mr. Riddell: -- but the member for Welland-Thorold has said I advocated high interest rates for the farmer. I tell you, Mr. Chairman, he has perpetrated an outright untruth, because never have I advocated high interest rates for farmers. I said in my speech on Bill 179 that high interest rates happen to be part of a restrictive monetary policy.

Mr. Chairman, if you do not like the idea that I have said it is an outright untruth, then you tell me. I am prepared to be escorted out of this room, because I will not retract it. I have listened to him say that and if he can prove that I have said it, I am willing to see the proof. But until now, I say that the member for Welland-Thorold is perpetrating untruths and I do not intend to stand for it.

The Acting Chairman: I am sure the member for Huron-Middlesex will realize that he rose not on a point of order but on a point of privilege which extended to a point of clarification. He will also recognize, because he provoked the chair to recognize it, that he may have contravened the standing orders by suggesting that another member of this House may have uttered a deliberate untruth. That is the point of privilege we are now on.

The member for Welland-Thorold has caught my eye and also will rise on a point of privilege.

Mr. Swart: Mr. Chairman, I am not sure I heard exactly what the member said on his point of privilege. I rise to say that I quoted from Hansard rather extensively where the member, as he now admitted --

Mr. Riddell: Get out the Hansard and prove it.

The Acting Chairman: Order.

Mr. Swart: -- said he was supporting high interest rates. I will admit he did not say he was supporting them exclusively for farmers --

Mr. Ruston: That's what you said.

Mr. Swart: No. I did not say exclusively --

Mr. Riddell: It is pretty near time you decided to tell the truth.

The Acting Chairman: Order.

Mr. Swart: I said he supported high interest rates in general. He did not say "excluding farmers." He said, "I support high interest rates."

10:10 p.m.

Mr. Riddell: I said high interest rates are a result of a restrictive --

The Acting Chairman: Order. Will the member for Welland-Thorold identify his point of privilege or resume his seat, please?

Mr. Swart: Mr. Chairman, I am not sure of the exact words of the member for Huron- Middlesex --

Mr. Riddell: Well, if you don't know what you are talking about, don't talk about it.

Mr. Swart: -- but I think they were unparliamentary and should be withdrawn, because I believe he accused me of making an untrue statement.

Mr. Riddell: You want to believe it.

The Acting Chairman: The member for Huron- Middlesex has indeed accused another honourable member of this Legislature of deliberately uttering a mistruth. For the sake of order and decorum, will the member for Huron-Middlesex now withdraw that remark?

Mr. Riddell: Mr. Chairman, I have heard him say that so many times and it definitely is not the truth. He cannot show anywhere in Hansard that I have advocated high interest rates for farmers or anybody else.

The Acting Chairman: Will the member for Huron-Middlesex withdraw the remark?

Mr. Riddell: I am telling you he has distorted the facts.

The Acting Chairman: Will the member for Huron-Middlesex withdraw the remark?

Mr. Riddell: No, Mr. Chairman, I will not.

The Acting Chairman: I ask the member for Huron-Middlesex one last time and I caution him that if he is not prepared to withdraw the remark, I shall be obliged to name him. I shall have to move that the committee rise and report the situation to the Speaker in the House.

Mr. Riddell: Mr. Chairman, you do what you have to do, but I will not stand to have somebody deliberately distort the facts. That is what he did and I cannot withdraw.

The Acting Chairman: Then I have to name the member for Huron-Middlesex, Mr. Riddell.

The Acting Chairman suspended the proceedings of the committee and reported to the House.

The Acting Chairman: Mr. Speaker, in the committee of supply the member for Huron- Middlesex accused the member for Welland-Thorold of uttering a deliberate mistruth in the House. At my invitation, he refused on two occasions to withdraw the remark. Under the provisions of the standing orders, it was my responsibility as chairman of the committee of supply to name him and to report to the House. I now so do.

Mr. Ruston: Mr. Speaker. on a point of order --

The Acting Speaker (Mr. Treleaven): It is without debate. There must be no debate and no point of order on this. There is nothing out of order. The chair will not recognize that. The member for Huron-Middlesex is again requested to withdraw his remarks.

Mr. Riddell: Mr. Speaker, when I know I am right I cannot withdraw the remarks. At no time have I advocated high interest rates for farmers, which is what the member implied. It is not correct and I will not withdraw.

The Acting Speaker: Might I point out to the honourable member that it is not a question of whether he is right or wrong. It is a question of propriety in the House. Your withdrawal is not a statement as to the veracity or otherwise; it is only to withdraw that statement in the House. Will you please withdraw it?

Mr. Riddell: Mr. Speaker, I do not know how many times I have listened to that member say the same thing ever since we started the agricultural estimates and I cannot withdraw it.

The Acting Speaker: Then the member for Huron-Middlesex is hereby named. Will he please leave the chamber for the balance of the day?

Mr. Riddell: Gladly.

The Acting Speaker: Thank you.

Mr. Riddell left the chamber.

Mr. Ruston: Mr. Speaker, on a point of order: Something that bothers me, and it has bothered me on previous occasions when the former Speaker was in the chair, is that a member can get up and speak about another member without verifying what he says. You forced a member to leave this Legislature because of what another member said. The member asked the other member to prove it and he could not.

I realize you can only do what has been done in the past. I also realize you are new at the job, and I would not want to put you in an unfair position, but I think it is very unfair. If the person who accused the member for Huron-Middlesex of saying something could have stood up in his place immediately and verified exactly what he said, then I think you would be perfectly in order in advising the member to leave, but otherwise I do not think you were in order.

The Acting Speaker: That is not a proper point of order. We are under standing order 19(d)8, which says simply that a member is out of order when he "makes allegations against another member." As Mr. Speaker has mentioned over and over, it is not up to the chair to determine the veracity of the allegation or the other side. It is not the duty of the chair to do so, but simply to rule when there is an allegation made against another member in the House which is not permissible under the standing order. It is as simple as that.

House in committee of supply.

ESTIMATES, MINISTRY OF AGRICULTURE AND FOOD (CONTINUED)

On vote 1901, ministry administration program:

Mr. G. I. Miller: Mr. Chairman, I had a supplementary going back a while ago in regard to some of the questions put to the minister with regard to the program to protect our farmers.

First, I want to say I admire my colleague the member for Huron-Middlesex (Mr. Riddell) for standing up for his rights, because I am sure that we would never promote higher interest rates for the farming industry at any time or at any point. That is particularly true of my colleague the member for Huron-Middlesex, who understands the farming needs much more than do our socialist friends on the left.

Interjections.

The Acting Chairman (Mr. Robinson): Order.

Mr. G. I. Miller: It irritates me to no degree when the minister gets up and speaks about trying to encourage our young people to get back to the farming industry. He cites the example of Saskatchewan and how they have made a turnaround with the new government. My colleague again indicated that they are coming forth with a program of assistance and perhaps get 5,000 new farmers back on the farm in the next three or four years.

I do not see any place in the minister's opening statement where he has that kind of plan. Rather, we have a declining farming industry with fewer people on the farm. That is what is taking place. What has happened over the past 10 years is that the number of farms has gone from 125,000 to 85,000, and the minister himself indicated today that it is now down to 82,000. That was the figure used.

The minister indicated that he has saved 3,000 farmers this year with the low-interest assistance program. I will grant him that we have been able to maintain numbers, particularly in my riding of Haldimand-Norfolk. Several farmers met with the minister and his people, and we have been able to keep some of those young farmers on the farm for this past summer, but I do not know about the year to come.

I want to bring to the minister's attention two resolutions that were brought to the Ontario Federation of Agriculture annual meeting from the federation of the county of Haldimand. The first one reads, "Whereas low yields and low commodity prices threaten many cash-crop farmers in Ontario this fall; and whereas the depressed economy and North American grain surpluses promise no immediate improvement; and whereas the success of the Ontario farm adjustment assistance program for the red meat sector has demonstrated a critical need for a permanent and predictable vehicle for farm operating capital; therefore, be it resolved that the Ontario Federation of Agriculture lobby the Ontario government to have the Ontario farm adjustment assistance program extended and improved as a permanent vehicle for farm operating credit."

10:20 p.m.

I wonder if the minister might give that consideration and, instead of having the interest rate come down five points to 12 per cent, perhaps the five points could be deducted from today's interest rate, whatever it is -- say 15 per cent -- down to 10 per cent to give them full advantage of the five per cent.

The low prices for corn and soybeans and the difficult problem they have had with their wheat quality because of poor conditions in the harvesting season this past year, are going to put a lot of pressure on many of these young farmers. For example, frost has caused tremendous damage to farms in certain areas. One farmer harvested only 12 bushels to the acre of soybeans and corn, when normally he would have averaged 25 bushels per acre.

I have suggested to these farmers that they have the alternative of utilizing OFAAP or crop insurance, but even after they have looked at those alternatives I do not think they will be able to pay the interest rate -- which in the case of the particular farmer I cited was 16 per cent -- so I think this resolution that was brought forward by the Haldimand farmers to the Ontario Federation of Agriculture has merit.

The second resolution that was put before the OFA convention was for a moratorium on farm bankruptcies. That resolution read as follows:

"Whereas the 1981 emergency task force on agriculture recommended an immediate moratorium on farm bankruptcies, receivership and voluntary liquidation; and whereas low yields and lower commodity prices are even greater concerns of cash-crop farmers this year than high interest rates were last year; therefore, be it resolved that there be an immediate imposition of a moratorium on farm bankruptcies for a 12-month period."

My colleague the member for Huron-Middlesex asked if the minister would give that resolution consideration if matters continue to deteriorate, so that the young farmers can have some assurance that they will be able to realize their lifelong ambition to remain in the farming industry in my riding of Haldimand-Norfolk and in Ontario.

Mr. Ruston: Mr. Chairman, I want to speak about the general operations of the minister's office. I know he has had the appointment for only a few months and I think he is working at it quite hard. I know he is ambitious.

I attended a function in the county of Essex at which the minister made a presentation with regard to tomato paste and the introduction of new plant facilities to increase tomato acreage. I mentioned to him at the time that Mr. Stewart, former Minister of Agriculture and Food, and I many years ago used to talk about the amount of tomato paste which was imported into the country from abroad. I know from some of the companies I talked to, such as Del Monte and some others, that a lot of it was imported from the United States.

I think that is probably one of the best routes the minister has taken since he has been in that job. I know he started it last year on a small scale. For the H. J. Heinz Co., I think the total expenditure is around $18 million for what they are doing. I think the grant was $3 million and they were going to --

Hon. Mr. Timbrell: Fifteen million.

Mr. Ruston: Fifteen total? Theirs would be around $12 million and yours $3 million. Okay. Then the Primo one in Gosfield North township just a few weeks ago was $1.3 million or something, I believe, and I think the Primo company has already spent most of its money on facilities. In talking to some of those who are operating this plant, I found that they will be increasing their acreage quite considerably.

That means a great deal for two reasons. First, it stops the imports and so much of our money going out of the country. Also, it creates a great deal of employment in an area that has a very high unemployment rate, with the city of Windsor and the automobile industry the way it has been for the last couple of years.

That will mean a great deal to the farming area of Essex and Kent counties, because we have some of the best land for growing tomatoes. Not only is it the best land, but one thing some people forget in class 1 and 2 land is the heat unit that is developed in an area, which really is probably the main part of it as well, because you just cannot grow tomatoes unless you have the heat to ripen them and so forth in the long growing season we have in Essex county. So it means a great deal to that area.

An interesting thing happened at the function that day. We had a light luncheon put on at the Ciociaro Club in Sandwich South. The minister has something in mind for the future, I would think. Very kind fellow that he is, he introduced me as the local member and Mr. Detmer Bridgen, the reeve of Gosfield North, where the facility is located. Mr. Patterson, who was the Progressive Conservative candidate for Essex South in the last election, was acting chairman of the function that day and he said he wanted to introduce a few of the Progressive Conservative Party members who were there for the function.

Mr. Wildman: He did not turn it into a partisan event, did he?

Mr. Ruston: I have been in politics for 15 years here and eight years in municipal politics, and I have had quite a few meetings, connections and ministers down in the area from the federal and provincial governments. I have never in all my life seen a minister come into an area and present a cheque, which is a nice thing to do, where at that meeting the second group he introduced was the Progressive Conservative Party of that area: voila -- former candidates, different presidents in different executives of different parties. And that is no problem.

I think, though, the minister should have done it in a little different rotation, because he then introduced the farmers, and they are really the important ones when it comes to tomatoes. If we do not have the farmer out there planting them, working that soil down and looking after it, we will not have any tomatoes to put into the factory. I would not have done it that way, and in my time in politics I have not seen it done in a way that was so politicized.

I can understand the minister; I know the Premier (Mr. Davis) will be retiring in a couple of years and there is going to be an opening for the leadership. It never bothers me much; that is politics. My dad used to say that the democratic system might not be the best functioning or the cheapest, but there is no other that is any better.

The Acting Chairman: With that particularly inspiring note from your father, I draw the honourable member's attention to the clock.

Mr. Ruston: I suppose I have another 30 seconds, but I guess that is okay. I will let it go until another day.

On motion by Hon. Mr. Timbrell, the committee of supply reported progress.

The House adjourned at 10:30 p.m.