PUBLIC SECTOR PRICES AND COMPENSATION REVIEW ACT

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The House resumed at 8 p.m.

PUBLIC SECTOR PRICES AND COMPENSATION REVIEW ACT

Hon. Mr. Grossman moved second reading of Bill 111, An Act to provide for the Review of Prices and Compensation in the Public Sector and for an orderly Transition to the Resumption of full Collective Bargaining.

Hon. Mr. Grossman: Mr. Speaker, in moving second reading of Bill 111, I would like to address a couple of the issues that have been raised over the past week or so. I should like to begin by saying I think it is appropriate to pause after the first year of Bill 179, or the first year of its application to the public sector employers, to contemplate on what the future holds and what the long-term goals of every member of this House ought to be.

Mr. Nixon: Is this a pension discussion?

Hon. Mr. Grossman: Yours or mine?

We ought to point out, in bringing in this kind of legislation, it is done this year, as it was last year, with some degree of reluctance because it will appear to the public that, to some extent, the public sector has been asked to bear a particular portion of the burden of restraint.

To put it in some perspective, however, we should always remember that while unemployment overall in our economy is now at about 9.5 per cent in Ontario, almost all that unemployment is in the private sector. Therefore, it would be only fair to point out that the private sector has borne a large portion of the burden of this recession. Many of the employees in the private sector who lost their jobs, the 400,000 people who are now unemployed, largely had no choice and carried the burden of restraint in the most difficult way possible, through unemployment.

In the public sector, therefore, when we choose to take some action, it is albeit with reluctance but also with understanding that it is fair that --

Mr. Foulds: It is called restraint.

Hon. Mr. Grossman: Could I have two of those bicentennial buttons? My kids are in the gallery there. Send them over to them.

Mr. Foulds: The minister has two bags in his office.

The Deputy Speaker: The minister will carry on with his opening remarks.

Hon. Mr. Grossman: I resent the member saying that.

In any case, I think it is only fair to say the public sector, which is being asked through this legislation to share in what everyone must surely be going through during the recession and the recovery efforts, has served us extraordinarily well. They have served us in the municipalities, in the school boards, in the hospitals, and by serving this government directly in ways I consider to be unparalleled. I have always felt it was unfair of those members of the public who just blithely say, "You have too many civil servants. They do not work hard enough." I have always rejected all of those suggestions.

Mr. Nixon: How can they say that? We have only 85,000 of them.

Hon. Mr. Grossman: We have 80,000. We used to have 85,000 but we have reduced our civil service unlike --

Mr. Foulds: Are you counting speechwriters?

Interjections.

The Deputy Speaker: Order.

Hon. Mr. Grossman: That is everyone.

In any case, having confirmed our deep faith in and commitment to the public sector in this province, I think we have to acknowledge that in the steps we take. I would say in this restraint program we have chosen to take a very moderate and fair approach. We would define our approach as quite fair and flexible. It will serve those who are paying the costs of our civil service well and it will serve those who are members of our civil service and the public sector well also.

I should say that some people will suggest -- I do not know from which quarter -- there is no longer any need for restraint, while others will suggest perhaps that we should have been tougher and stuck with the Bill 179 mode. In rejecting both of those extremes, I think it is also important to remember that, as we look past the next year or so, we must understand that this government and the people in this province have been served well by the collective bargaining system in the public sector and served well by the dispute resolution mechanisms that have been in place for many years and are going to continue to be in place this year.

Mr. Nixon: Tom said 40 minutes and, therefore, it has to be 40 minutes.

Hon. Mr. Grossman: I told him 10, and that is what it is going to be.

In saying that, we also must acknowledge if we believe, as I know the regional chairman, Mr. Bean, sitting and watching us this evening from the gallery will share this -- I see he has some aldermen from the great city of Mississauga with him as well --

Mr. Rae: Stop facing those delegates.

Hon. Mr. Grossman: I play guitar. I do not play as well as the member plays the piano.

Mr. Nixon: I do not see Hazel there.

Hon. Mr. Grossman: In any case, as I was saying, I know the regional chairman agrees with me that in the long term we must return totally to the ordinary dispute resolution mechanisms. In so doing, we must begin the transition, and take a big step in the transition back to that circumstance, this year.

The longer people are constrained, particularly in the kind of narrow and tight restraint that was absolutely necessary a year ago, then the more there are going to be pent-up demands and more inequities growing up. Those are the kinds of inequities and the kinds of pent-up demands that will cause inflation to come right back to us the moment that legislation is taken off.

Mr. Bradley: We should have some restraint on speechwriters.

The Deputy Speaker: I am going to put a restraint on your interjections.

Hon. Mr. Grossman: Therefore, in taking off legislation, one must be as cautious and as thoughtful as one is in bringing in legislation. In so doing, I think it would have been quite dangerous for us to keep a tight restraint program on for two years and at the end of the second year just vacate the field and see what happens then. I think that would be a prescription for disaster.

Therefore, the government has decided to take a more moderate approach, a transitional approach to restore full collective bargaining in its entirety this year and have those, the regional chairman and others, participate in going back to the bargaining table --

Mr. Bradley: Taking the blame.

Hon. Mr. Grossman: Let me say all of us elected officials are willing and prepared to take the blame. I have not heard any municipal council yet say, and I have watched the reactions very carefully, and I have not seen any municipal councillor yet say he or she is unwilling or unprepared to face up to his or her responsibilities in bargaining appropriately and with restraint with respect to their local ratepayers and taxpayers in their municipalities.

I think the same applies to the school boards. Those who take the position this legislation is going to cause people to bargain carelessly or cause the ratepayers and taxpayers to have to pay much more than they otherwise would have to pay are, I think, dramatically underestimating public sector employers -- that is, the municipalities and school boards -- and also the unions involved.

8:10 p.m.

I listened carefully as the public sector employers and the public sector unions assure me and the Premier (Mr. Davis) they would bargain with due respect for those 400,000 people who are unemployed, those 400,000 people who, one way or another, were continuing to pay the public sector wages and public sector costs during this period of time. I do greatly respect their commitment to our recovery.

They assured us of that. I believe we can count on that sort of commitment as we climb out of the recession and continue on the path to recovery.

Mr. McClellan: In that case, if you believe that, you do not need the legislation.

Hon. Mr. Grossman: The honourable member for Bellwoods (Mr. McClellan) says that if we believe that we do not need the legislation. Of course, he will know, having studied the bill so carefully, that we have trusted them a great deal. I know he was surprised to see how much we did trust them.

Mr. Bradley: We were all surprised.

Hon. Mr. Grossman: I know those members were. I was watching their faces as I read the statement.

But it would also be negligent of us if we did not set up a monitoring mechanism.

Mr. Kerrio: I was not surprised. I knew --

Hon. Mr. Grossman: The member for Niagara Falls (Mr. Kerrio) fainted. He wanted to run over here so fast we could hardly keep him on that side, and we wanted to.

Mr. Bradley: He does not believe in the politics of patronage.

Hon. Mr. Grossman: How is Mike Bolan doing on the bench?

In any case, might I say it would have been a mistake for us to withdraw totally.

Interjection.

Hon. Mr. Grossman: Save me from my friends.

It would have been a mistake for us not to control our transfer payments. It would have been a mistake for us simply to say, "Go bargain and do not let us know what is happening."

I think it is our responsibility to monitor the circumstance very carefully to see how it is going, to have the Inflation Restraint Board in place, to have it get full details of any negotiated agreement and ask for whatever details it needs of those agreements which cause it concern, and to allow it to make public the true cost of any settlements it believes ought to be well understood by the public, which ultimately has to pay for that settlement. All of those steps are very appropriate in a transition back to a normal circumstance which I know all members will agree has served us very well over the years.

In dealing with just one of the other significant provisions of this legislation, the arbitration process, one of the things that, predictably so, has not received much attention is the fact that we have not only set up mechanisms to make sure the arbitrators take into account the economic circumstances of the day -- that is, the ability to pay -- and to ensure that they address themselves to the full and true costs of each and every part of the arbitrations they bring down, but that this will also give us the opportunity to discuss with labour and public sector employers the arbitration process in total.

I have had the opportunity to hear the comments of both labour and management in this area. They have obviously not got the same concerns about the arbitration process. I think the arbitration process, like many other processes of government, bears analysis and discussion from time to time.

The two alterations we are making this year are alterations which are particularly appropriate to the transition period in the restraint program. We will see how they operate this year. We will watch it very closely. The lessons we learn from this particular exercise will be instructive to all persons involved in the process.

My colleague the Minister of Labour (Mr. Ramsay) will be setting up a mechanism whereby labour and the public sector employers can discuss the future of the arbitration process, can analyse how it has gone during this year and the effect of Bill 111. At the end of that period of time, further decisions can be made with regard to keeping those kinds of provisions in a new piece of legislation, abandoning or changing them, or whatever.

I think it is important in this transitional year to have those kinds of factors in place to assure the public the ability to pay is being taken into account and that the arbitrators have taken note of the true cost of those settlements and arbitrations.

All in all, I would urge the support of the assembly for this legislation. It treats people involved in the process fairly and flexibly. It allows some of the problems that have developed over the first year of this restraint program to be dealt with, and to be dealt with by the people who have traditionally shown themselves to be best able to deal with them, that is, their bargaining groups, their representatives, their unions, their bargaining agents and their employers sitting down around the table together and deciding what distribution of the wage package is appropriate. I know the members of the third party share that view with me totally.

Mr. Foulds: If you have so much faith in collective bargaining, why don't you restore it in full?

Mr. Rae: It just sticks in the craw after the last year you put people through. It is garbage.

Interjections.

The Deputy Speaker: Order.

Hon. Mr. Grossman: It is music from this side; from that side it is noise.

Interjection.

Hon. Mr. Grossman: I did read that, Albert. They did not say it is was buck-passing. They said it was the right direction to go. I read it carefully.

That sort of package, which allows us to treat people fairly and flexibly, which introduces flexibility and self-determination into the collective bargaining system in the public sector, is surely the right way to go. Those who object to it and say, "Keep restraints on as tight as last year" will be voting no confidence in the traditional mechanisms that have served us very well and in the public servants who also have served us well.

Mr. Foulds: That is what you did last year. You voted no confidence.

Hon. Mr. Grossman: Conversely, some of those people who would argue no restraints are necessary argued that case last year. None the less, the proof is quite clear. Inflation last year was at 11 or 12 per cent. Now it is at five per cent. There are 169,000 more jobs in Ontario this year than last year. Those are not totally attributable to government, but neither are they an accident. If the members do not believe it, look at some of the other provinces.

Interjection.

Hon. Mr. Grossman: From the member that a compliment, from the receiving end of things.

The Deputy Speaker: Order. The minister will continue with his remarks.

Hon. Mr. Grossman: The Deputy Speaker in his previous incarnation carried so much of the responsibility for Bill 179 he will understand perfectly the need for a continuation of some form of restraint and the need to take the transitional step we are taking at this time.

On balance I know all members of this House will share with me the desire to move back to the traditional mechanisms and the desire to do that in a timely, measured and appropriate way. Surely this bill addresses all those responsibilities and all those needs in a moderate and appropriate way. Therefore, I look forward to the early, smooth and quick passage of this very fine transitional piece of legislation.

Mr. T. P. Reid: Mr. Speaker, it is interesting that the Treasurer made what can only be called a half-hearted attempt to explain, if not defend, the legislation he has introduced tonight. It gives rise to the belief that perhaps Larry Zolf on CBC Metro Morning was correct. Perhaps the member for St. Andrew-St. Patrick is not happy in his position as Treasurer and he is going through the motions and looking for some other portfolio where he can once more be seen to be doing things as opposed to saying no. I believe that was the phrase.

8:20 p.m.

Mr. Riddell: Is that why he is now donning rubber boots and going out into the country?

Mr. T. P. Reid: I understand he always dons rubber boots before he makes remarks like those he just made.

It is with some pride, representing the Liberal Party --

Mr. Nixon: And the Liberal-Labour Party.

Mr. T. P. Reid: That too.

It is with some pride that we contemplate what happened a little over a year ago with regard to Bill 179. On October 24, 1983, the Divisional Court of the Supreme Court of Ontario ruled by a two-to-one vote that clause 13(b) of the Inflation Restraint Act, 1982, was contrary to the freedom of association provisions of the Charter of Rights and Freedoms. You may recall, Mr. Speaker -- not these barracking seals to my left -- that it was the Liberal Party that tried to amend Bill 179 in that very instance.

Mr. McClellan: And to make it permanent.

Mr. Nixon: We were right again.

Some hon. members: Nixon now.

Interjections.

The Deputy Speaker: Order. The member will proceed.

Mr. T. P. Reid: I do not understand how all this happened. I saw most of these people in the members' dining room. The food there is usually enough to calm everybody down.

In any case, we attempted to do our best to make that bill as fair and equitable as possible. As I indicated, our reasoned arguments at that time were upheld by the Supreme Court of Ontario in regard to clause 13(b) of the bill. It is patently obvious, in response to questions from this party and the third party, that the arguments put forward at that time, which were supported by the Divisional Court, led to the situation we have here tonight with Bill 111.

I might as well use this phrase, because I am sure my friends on the left are going to use it: "Restraint if necessary but not necessarily restraint."

We are dealing here with the fact that the Supreme Court, in its ruling on Bill 179 -- by a different two-to-one split -- decided the wage and price control legislation was justified, given the inflationary "emergency."

Everybody and his uncle, or aunt, and his federal Liberal or Conservative brethren and so on are now taking credit for inflation coming down from almost 13 per cent to five or six per cent. One can only believe that, as usual, these things were a conjunction of events. It is possible the operations of this Legislature had only a marginal impact on the actual economic determination of inflation.

Mr. Rae: Are you calling Keith Davey a liar?

Mr. T. P. Reid: I know he has been called worse than that.

I only give this background on the Supreme Court of Ontario ruling to put it in the context of Bill 111. The piece of legislation we have here this evening has nothing to do with those court rulings, in that they will not have the same kind of impact before the courts. The government obviously learned its lesson. Had it listened to the Liberal opposition in the first instance, it could have avoided the embarrassment to the Attorney General (Mr. McMurtry), who lost for the seventh or ninth time in a row before the Supreme Court of Ontario. Unlike members opposite, he has been consistent in losing almost every challenge before the courts.

We have some concerns about the bill. We see it as a bit of smoke and mirrors. The intent of restraint is supposedly there, but it really is not. The Treasurer has done a great job of keeping everybody happy -- I find this of particular interest -- and reasonably calm.

Mr. Nixon: Even the New Democratic Party.

Mr. T. P. Reid: Even the NDP; they have not been able to gird themselves up in those tight shorts they put on when their voices get high and they shriek and shrill -- except about the doctors. Is it not interesting -- it is certainly interesting to me -- that last year, as Liberals, one of our fundamental complaints about the bill in terms of fairness and equity was that everybody had to be treated as fairly and equitably as possible?

Mr. Rae: You voted for it three times.

Mr. T. P. Reid: My friend says we voted for it three times. He is absolutely correct. But if he can tear himself away from the calendar issue, because I understand he is still trying to figure out how he got $12 for the Treasurer's calendar, I remind him of the fact that the government, playing its usual game, kept hoisting off and saying: "We are going to deal with the doctors. By God we are going to bring them to heel, and they are going to be under Bill 179."

As time and a half went by, we got sucked in -- if I may use that phrase, I do not think it is unparliamentary. As time and a half went by, the bill came to a vote and we presumed that even this government would not have the audacity to allow the doctors to keep the increase they had negotiated with the new Treasurer, the then Minister of Health.

Is it not a delicious irony for those of us who said everybody should be treated equally in this that a year later that same Minister of Health, now the Treasurer, is standing in his place before us and banging his table, saying, "The doctors will be included in this program because these are transfer payments under OHIP." In a year's time they all became not self-employed entrepreneurs but recipients of transfer payments, as neat a juggling act as even Mackenzie King was able to do in his day.

Hon. Mr. Grossman: Is that your argument?

Mr. T. P. Reid: I was going to say it grabs me, but I do not have the talent and finesse of the Treasurer for the bon mot. However, it really is an interesting situation, because two things also get lost in this. One is that as of January 1, 1984, the doctors are still going to get their increase; they are not being restricted to five per cent.

The other part that really gets me is that the head of the Ontario Medical Association called a press conference, went on television and talked about being doublecrossed and stabbed. He said he was a man of principle and he believed that a man's word was a man's word and that a contract was a contract.

With respect, I wonder where that doctor and his association were the year before when the government did that very thing to the civil service. I mean, fair is fair. I must say I do not have much problem with the doctors in terms of the hours and the time they work in most cases, but I find it almost --

The Deputy Speaker: I wonder if I may interrupt the member to exercise the prerogative of the chair. In the course of the debate, the Treasurer mentioned that we had in attendance in our gallery the regional chairman of one of our regions, Chairman Bean. He mentioned they have been partners in the debate as we talked about constraint and restraint. We also have with us this evening the mayor of one of our municipalities -- it happens to be the Deputy Speaker's municipality -- Mayor McCallion of Mississauga. We welcome Madam Mayor.

Mr. T. P. Reid: It is always nice to see a Grit here -- or a sometimes Grit, Hazel; I am not sure which.

Anyway, Mr. Speaker, you stopped me in full oratorical flight about the delicious irony of the then Minister of Health oozing in and out of these back rooms trying to bring the doctors to some accommodation and saying, "Look, boys and girls, we are all in this together, and if you do not go along with this, we are going to have to do something;" and the doctors stabbing him in the back as badly as he has been stabbed even by the other members of his caucus who are running for the leadership along with him.

8:30 p.m.

It was interesting that on the day of the appointment of the Treasurer, the press asked the present Treasurer -- the then Minister of Health, who had given the store away to the doctors in the terms and context of Bill 179 -- "Mr. Grossman, what is your view and philosophy as the new Treasurer of Ontario?" He said: "Restraint, restraint, restraint." This was the man who had given the doctors some 13 per cent not very many months before.

All of these things are coming back to haunt the Treasurer. But with the greatest aplomb that those people over there have taken unto themselves since, as the Premier would say "the realities of March 19," nothing bothers them any more. They know the action is at the federal level with Pierre. Will he? Will he not? Will the Jaw do it? Will he not? They can get away with all of these things.

I must say I took, in the meanest corner of my heart, just a teensy-weensy little bit of comfort that here was the same man a year later getting his own back at the doctors. It was an interesting thing. But, as I said, let it not be forgotten that they are not being restricted this year to five per cent. They are still going to be doing much better than that.

We have some particular concerns about the bill. We want to see this bill go to public hearings so that those directly affected will be able to come in and say their piece. I trust the Treasurer will be amenable to that. I presume my friends to the left will request and require it as we do.

I want to put that up front so the Treasurer will not have any concern in his mind that this is where we want to see this bill as a signal for those who have legitimate concerns about this legislation that they will have their day in court. We have seen in matters of other legislation that this does not always happen in Ontario.

We are not out of the economic woods yet. Frankly, one of the disappointments to me about the new Treasurer, whose ability I have a high regard for -- he has survived a lot of knife thrusts that would have brought down poor old Duncan --

Hon. Mr. Grossman: Stuart Smith.

Mr. Rae: Try Stuart Smith.

Mr. T. P. Reid: Stuart Smith was another question. How about the member for Ottawa Centre (Mr. Cassidy)? One thing about Stuart Smith: he was always stabbed from the front. The member for Ottawa Centre always had the knives in his back, but we will not go into that. He always said he always backed out of the NDP caucus; but do not let me get away from this.

Our concern about this bill is in two major respects. One is, we obviously have concerns about the wage side. The other side where we have concerns -- and I will not reiterate all our amendments from Bill 179 is on the price side. Our concerns really are on the price side. If we are going to say to people, "We are going to keep a cap on your wages; we are going to restrict you," then it is only fair that those administrated prices under the aegis of Ontario should be controlled at the same level.

One thing that concerns me as a legislator of some years here is that in the past we have made the mistake of giving too much discretion to the Lieutenant Governor in Council; i.e., the cabinet. For instance, I remember when we passed the bill setting up the Ministry of Energy, there was a phrase in there that allowed the government to go out and buy an oil company. It never occurred to most of us on this side of the House, and obviously 90 per cent on that side of the House, including the member for Leeds (Mr. Runciman) and even the former Treasurer, the member for Muskoka (Mr. F. S. Miller), that a good Progressive Conservative government of Ontario would go out to buy an oil company.

Before we finish second reading, I hope the Treasurer will address himself to two matters. First, the bill provides that the Treasurer shall in some cases the wording in the bill is very vague -- provide criteria upon which judgements will be made by the Inflation Restraint Board. It disturbs me that we in the Legislature, obviously because of the numbers in the place, are going to give the Treasurer the ability to set criteria in terms of wages, what the wage package will consist of, whether it will be merit increases, staff increases, benefits or perks of whatever kind one wants to name. In fact, we do not know what those criteria are.

The same thing comes under the price side of Bill 111. The Minister of Consumer and Commercial Relations (Mr. Elgie) shall provide such criteria as he sees fit. Last year, we were provided with some of the things from that minister by letter of September 23, 1982, in regard to regulated prices. In fact, this whole thing gives the government, the Treasurer and the Minister of Consumer and Commercial Relations too much scope. We do not know what the criteria are going to be. In a democratic society, I think we should be able to have those criteria laid before us. May I ask the Treasurer whether we are going to have these criteria tonight?

Hon. Mr. Grossman: Not tonight.

Mr. T. P. Reid: Are we going to have the criteria before we vote on second reading of the bill?

Hon. Mr. Grossman: It depends when we vote on second reading.

Mr. T. P. Reid: The fact is that too much of what we do in this chamber is based on regulations drawn up by the civil service and passed by the cabinet, which sometimes even frustrates the spirit of the very bills and legislation we are going to pass. I really think the nuts and bolts of this to a large extent are based on the kind of criteria the minister is going to set.

I have to balance that off with the fact that all the arbitrators do is consider these matters; we do not suppose that they should have the ability to make these final judgements. In terms of the price side of the equation, all that is going to happen is that the Inflation Restraint Board can report to the minister exactly what it has found. This does not necessitate any kind of action on behalf of the Treasurer or cabinet.

The other thing that bothers me about this section is that at the same time these decisions of the Inflation Restraint Board will not be made public. We can understand the confidentiality of the information the arbitrators draw to themselves to make their decisions; however, what we cannot understand is that the people who either make the complaint about the price side, or the cabinet or others who might suggest that some of these prices are out of line, will not necessarily under the legislation get any kind of answer to what they have asked for.

8:40 p.m.

One of our amendments, among at least five others, will be that anyone in the public in Ontario can ask the Inflation Restraint Board to review an administered price increase by Ontario or any of its agencies, boards or commissions and ask for an explanation as to why it is above the five per cent ceiling.

The other matter that has caused some concern -- we have been in touch with a number of the people most directly affected by this, the union movement and so on -- is the reference that the arbitration boards will take into consideration the whole matter of the employer's ability to pay. It is an interesting issue. We heard some of it in the House this afternoon. As my learned friend the leader of the third party well knows, every time one has one lawyer giving a learned opinion, if that be what it is called, one will find another lawyer giving another learned opinion on the exact opposite side. From what I am told, that is how lawyers make their money.

It appears to be nearly universally accepted that the bill does not impose a five per cent ceiling on arbitrators' awards. They need only "consider the government's policy." I would like to quote one expert, former Osgoode Hall Dean Harry Arthurs. The minister has heard of him.

Hon. Mr. Grossman: He taught me everything I know about labour law.

Mr. T. P. Reid: Other than that, he has an excellent reputation. I am quoting him. Since the bill requires an arbitrator only to "consider the ability of the employer to pay," there is nothing to prevent the arbitrator from "considering ability to pay and then offering his reasons for awarding more than five per cent." What seems to bother or worry the unions is that weaker arbitrators may be swayed by the government's directive and restrict awards to five per cent, even though they are not legally required to do.

I listened carefully to the questions and answers in the House and I tend to agree with my leader that a lot of this is smoke and mirrors. I would have thought most arbitrators were taking into consideration the entire economic background of the awards they were making, including the ability to pay of the employer or management. I do not see it as unduly restricting the awards and I suspect, from what I have seen of some of the arbitration awards in the past, that this has not unduly restricted them from making the best judgement they can under the circumstances.

While we have some concerns about it, we find that generally that does not bother us as much as it would others, because the whole thing has been watered down sufficiently that there does not seem to be the kind of direction, shall we say, in Bill 111 in these matters that there was in Bill 179.

We have already indicated we have about six amendments. One of the things we are concerned about is that the bill does not treat everybody equally. We might have a situation, for instance, where the concept of what is the wage package is different for a group of teachers as opposed to policemen.

There seems to be an anomaly in the bill. In one instance the minister is dealing with wage increases, but in another group there might be a situation where, for instance in a police force, two, three, four or five constables might have to be hired, and those new bodies would be included in the overall compensation package, which in some small areas would negate or wipe out a complete wage increase for anyone. I wonder if the Treasurer might just focus his attention on that to ensure all groups are treated equally under this bill.

One of the other problems we see in this relationship is that -- again I will use a particular instance -- people working in nursing homes, who are what we may call paragovernment people for want of a better phrase, may find themselves unduly restricted because of the nature of their employment. In the last couple of weeks, we have heard at great length about what is happening to some nursing home employees in terms of being laid off for contract workers or casual workers. I see this as a problem within the bill in terms of their wage contracts as well.

Bill 111 is probably as well constructed an effort as we have seen by the government to be all things to all people; to say to their Conservative friends, "We are still having restraint," and to say to the unions and everyone else, "You are not really having restraint." We applaud it because we pushed very hard for the return to some kind of collective bargaining. We have seen almost all of the amendments we put forward last year come to fruition in this bill.

Our main concern is still the price side of the bill. We would like to see that strengthened. We would like to see more teeth in that. We would like to see Ontario Hydro, the Ontario health insurance plan, rent controls, all the administrated prices, all of those things kept at that five per cent level.

We understand there is a problem bringing in coal or other fossil fuels on occasion for Ontario Hydro and all the rest of it. At the same time, we really believe the government -- the Treasurer being one of the worst offenders -- has spent and wasted a lot of money on things such as Suncor, government advertising and speechwriters. There is still a lot of fat in the Tory underbelly that can be cut out if the Treasurer is really serious in what he said on the day he was appointed. As Mr. Mulroney said, "The issues are three things: employment, employment, employment." The new Treasurer of Ontario said, "Restraint, restraint, restraint."

I do not want to get diverted, but I did notice that the Treasurer opened one eye. I gather he was listening to me, so I want to just hark back to Goldhawk on the Canadian Broadcasting Corp. The people at CBC came to me and said they wanted to talk about government advertising. They said that last year the Liberal Party and others raised the fact there was at least $40 million in government advertising in a period of restraint. They said they wanted to have me and the new Treasurer on a show to debate this subject.

The present Treasurer, for some reason, declined to do that. I have never seen the present Treasurer afraid of anything, except perhaps the Minister of Agriculture and Food (Mr. Timbrell) breathing down his neck or vice versa; I am not sure which. I say that only in a leadership context.

8:50 p.m.

I found it passing strange that the Treasurer would not be in the studio with me to talk about restraint and how the government could preach restraint and at the same time the new Minister of Culture and Citizenship (Ms. Fish) would increase her budget for public relations by 130 per cent; and we have the situation of the honourable minister -- I cannot remember, he keeps changing positions so often; he is almost out the door anyway -- the member for London South (Mr. Walker) and his speechwriters and all that good stuff.

It was interesting, because I watched the program and the Treasurer, in response to the interviewer, said, "Mr. Reid is entitled to ask questions about advertising and all those things and of course that is his job." That was an admission that must have cost the Treasurer dearly because he tends sometimes to think that we do not have a role over here.

But then the interviewer said, "But what about this $40 million for government advertising in a time of restraint?" The Treasurer said, "Well, of course, Mr. Reid and his colleagues are just nitpicking, nitpicking, nitpicking." As if $40 million did not mean anything to the new Treasurer. Of course, for somebody who had given the doctors more than 13 per cent, I suppose $40 million was really nitpicking and why should anybody ask about it.

We believe, and we said it a year ago, that the economic circumstances called for restraint on behalf of all of the people of Ontario in both the public and the private sector. We still believe that. We also still believe that the government of Ontario, as evidenced by the various cabinet ministers and their programs, should be the leader in showing that it really believes in restraint. They do not do that by their expenditures on speechwriters and public relations people and consultants in advertising.

Most people obviously are prepared to go along with some kind of restraint but they will not go along with the hypocrisy that we have seen evidenced by this government and on occasion by this minister in the expenditures they are prepared to condone.

Mr. Speaker, I have gone on much longer than I had intended, but maybe I should draw to your attention --

Mr. Breaugh: Why do you not go for a little substance, just to wind up?

Mr. T. P. Reid: Oh, do members want more? It was interesting that in the public accounts committee this very morning we heard about a deputy minister who spent something like $617,000 on a Telepac situation for the government phone book without any reference to Management Board, without any feasibility study, without any reference to anybody. I should not say that; there was a reference to Management Board and it was turned down. They said, "Go away; this does not make sense."

Mr. Bradley: And over the objection of the minister.

Mr. T. P. Reid: And, I might add, over the objection of probably the only minister who really believed in restraint, the former Minister of Government Services (Mr. Wiseman). He said: "No, we are not going to do that. We are in a period of restraint. That is a silly expenditure. We cannot justify it." Who was there? Mr. Gordon, the deputy minister was there. But the only man who stood up in his place and was counted said: "I really believe in restraint. I believe in what the Premier is saying." Where has he gone?

It is a matter, I guess, as at the end of Julius Caesar: his going was, whatever, but his leaving was -- in any case --

Mr. Bradley: What about the Minister of Municipal Affairs and Housing's (Mr. Bennett) new office?

Mr. T. P. Reid: I am not even going to mention, as the member for St. Catharines (Mr. Bradley) said, the horrendous expense to the taxpayers of the new office of the Minister of Municipal Affairs and Housing and the $100,000 we are spending on it.

An. hon. member: Suite.

Mr. T. P. Reid: Suite, I am sorry.

The Acting Speaker (Mr. Robinson): Order, order.

Mr. T. P. Reid: In any case, we believe that the times, not only now but in the future, are going to call for that very tightening of expenditures across the whole economic spectrum, whether it be public or private. We call upon the government opposite to belie its past actions and give credence to its actions by Bill 179 and Bill 111 that it really believes in restraint. As we all know, if one wants to change the world one changes one's self. We hope that free-spending cabinet on its own will change itself and bring real restraint to its own expenditures.

Mr. Foulds: Mr. Speaker, I am going to be considerably longer than the other two speakers this evening. If I may say so, I am going to try to treat the legislation with somewhat more seriousness than the previous two speakers. I do not mean that in any derogatory or self-serving way.

We just happen on this Thursday evening, and Thursday evening sittings are notorious for their triviality and frivolousness, to consider this to be an extremely important bill. As the government has done nothing else in terms of its economic program and this is the only arrow in its economic quiver, we happen to consider that we should use this occasion to discuss some of the government's economic policies. It certainly used Bill 179 last year as its sole economic policy. It certainly used it as its sole economic initiative. If I may, this evening I would like to take the members through a number of issues surrounding the economics of Bill 111 and its predecessor, Bill 179.

I guess it will come as no surprise to the House that I rise on behalf of my colleagues to oppose this bill. We will vote against it. We will divide this Legislature on it as we did on first reading. Let me say clearly that the bill is not as objectionable in all of its particulars as Bill 179 was to us, but it is objectionable and it is objectionable both in some particulars and in its principle.

It does not, in my view, interfere in due process in such an objectionable way as did Bill 179, but it does attack certain fundamental traditions of this province and of this country. If the Tory party, the Conservative Party, and the Liberal Party of this province are not prepared to defend honourable traditions built up over the years in this province, then we in the New Democratic Party are prepared to defend those traditions.

We happen to believe with more than lip service that the traditions built up in labour relations in this province are worth fighting for. We happen to believe that the traditions built up in the public sector in the arbitration award process are traditions that are worth fighting for. If the beggars in the other two parties wish to attack them through their support for Bill 111, so be it; but this party is not going to remain silent this evening or on any particular evening about such fundamental issues and about such fundamental traditions that have been built up in this province because it suits the convenience of the members.

I would like to point out that there has been an interesting and subtle, but fundamental, change in the so-called Progressive Conservative Party of Ontario. The Conservative Party has always tried to maintain its hold on power in this province by saying it respects the traditions of this province. It has always given lip service to paying its dues to the process of law in this province.

9 p.m.

What we have seen in the last year or two is that when it has served the government's convenience, it has had absolutely no hesitation in interrupting that due process of law. It has had no hesitation in bringing in legislation that I believe in its heart of hearts it knew in the first place would be unconstitutional. It also knew that a challenge to the court and a finding of judgement on that unconstitutional legislation would take a year and it could get away with doing it. I find that a most peculiar and a most unsavoury use of the law.

As democratic socialists, my colleagues and I in this party have an enormous respect for due process, for the process of the law. That is what democracy is all about. It is the Tory party, together with the party to my right, the Liberal Party of Ontario, that has interrupted and attacked those fundamental conservative principles of respect for the law, authority and due process.

While Bill 111 is not as objectionable as Bill 179 of last year, it is still objectionable.

Mr. Bradley: Look what the Saskatchewan government did to the hospitals, or the Quebec government.

Mr. Mackenzie: You know a lot about it anyway. Talk about principles; it is a long way from you.

Mr. Rae: You guys are a bunch of prostitutes.

Mr. Foulds: I will not be diverted by the interjections, but I will point out that the government of Saskatchewan paid the price, and I believe the government of Quebec will pay the price. It is my most sincere hope and desire that the government of Ontario will also pay the price because it certainly deserves to. I want to put this House and the province on notice that we will be fighting both in this Legislature and on the hustings to make sure the government of Ontario pays that price.

One of the things that is fundamental about this bill, and more important fundamentally wrong about the Treasurer's statement, is that it does not substitute fairness and objectivity. Fairness is a word that never crossed the Treasurer's lips in his statement. Flexibility was the order of the day. He said his government considered five per cent to be fair. What an arbitrary statement to make.

Who is he in his wisdom, or his government in its wisdom, arbitrarily to declare, "We consider five per cent to be fair?" What does that have to do with objectivity? What does that have to do with the negotiations, the collective bargaining process the Treasurer paid such lip service to in his opening remarks tonight? What does the statement of the Treasurer, as spokesman for the government of the authoritarian Premier, mean when he says, "Five per cent is what we consider to be fair."

What it specifically does not do is substitute fairness and objectivity for those workers in the public sector who, for the public good, have had their right to withdraw their services, their right to strike, taken away by governments.

Specifically, I want to get into the arbitration aspects of the bill somewhat later in my remarks, but I was indeed shocked by the attitude of the so-called Leader of the Opposition (Mr. Peterson) this afternoon during question period when he said he considered making an issue out of the attack on arbitration to be making much out of nothing. I think that shows a fundamental lack of understanding by the Leader of the Opposition and by the Liberal Party of what arbitration is all about, let alone what labour relations are all about.

The most fundamental reason the bill and the Treasurer's statement are most objectionable is that they do nothing to solve the current economic crisis. The major economic issue of our time is the crisis in employment and the responsibility of creating jobs.

I want to talk about responsibility for a moment. The members of the Conservative Party of Ontario have always put themselves forward as the responsible managers of the province. They have always put themselves forward as being the party that is cautious but responsible, progressive but responsible and conservative but responsible. I have seen that responsibility fail time and time again in this House. I have seen an increasing number of incidents surrounding it. I will name a couple of the more trivial ones, although they illustrate the point.

The former Minister of Industry and Trade (Mr. Walker), without following the due process of Management Board of Cabinet, gave jobs to friends of the Conservative Party at a cost of $400,000 to the taxpayers of Ontario. Nobody over there accepts responsibility -- not the Chairman of Management Board of Cabinet (Mr. McCague) whose job it is to see that the Manual of Administration is followed, not the Premier, not the Treasurer (Mr. Grossman), not the current Minister of Industry and Trade (Mr. F. S. Miller), who yesterday washed his hands of the issue and certainly not the former minister. Where is responsibility there?

On a more fundamental note, I would say the greatest responsibility of government today is to try, in whatever manner and through whatever means it can, to create jobs. Jobs are the number one priority of any government in the western world today. Jobs should particularly be the number one priority of this government. Yet the only two job-creation projects I can think of that this government has done anything substantial with in the last 10 years are in the lottery business. The most visible short-term job-creation program it has created is the bicentennial project for 1984.

I found it somewhat offensive today when I went back to my office after question period to find that I, along with every other member of the Legislature, had been given this bag of bicentennial buttons, like a Hallowe'en treat bag, to give out to my constituents.

Mr. Haggerty: It did not cost you anything.

9:10 p.m.

Mr. Foulds: If that is the biggest job-creation program the government can devise for winter works over this coming hard winter, it has to be ashamed of itself. I am a button collector and my two kids are button collectors. I know several members who came to me when I brought the bag in this evening wanted them, including the Treasurer for his own family, and I do not blame them.

But what kind of triviality has government come to when we face the unemployment statistics we continue to face in this province and we have this kind of foofaraw, this kind of trivia, as a thing to make us feel good during 1984 in anticipation of or concurrently with a provincial election?

I do not know how many buttons were in there, but I would think several hundred. There were 1,000 buttons given to every member of the Legislature for his constituents. That is not even good bread-and-circus economics, but that is what it has come to with this government. They are practising the government and the economics of bread and circuses.

This government has abdicated its responsibility to create jobs. It has abdicated its responsibility to take initiatives in the public sector, in the private sector and with joint ventures to create jobs, and it is that which it must be fundamentally faulted for.

I want to deal with a number of issues this evening and I want to itemize them at the beginning of my remarks so the members listening understand the framework within which I am speaking.

First, I want to deal in some degree with the government's failure of leadership on economic issues. Second, I want to deal with the retreat by the government to the punitive kind of measures it has taken in this legislation and in other legislation because of its own failure to manage not only the economy of the province but its own mere fiscal budgetary responsibility. Third, I want to deal with some of the unfulfilled promises, particularly of the Premier, as they were made in the introduction last year of Bill 179.

History, in my view, will judge the Premier of Ontario, strangely enough, more harshly than it will judge the deposed leader of the federal Tory party. I want to say that very directly and very sincerely because the Premier of this province has had the authority, has had the power, has had the undying support and loyalty of his party and refused to exercise that authority in any kind of leadership role, whether it came to French language rights, educational rights, health services and rights in that sector, or economic rights and labour relations rights.

The failure of the Premier, given the enormous support, given the enormous authority, given the enormous power and control he has over his own party and over this Legislature to take initiatives and actions, will be judged harshly by history because essentially he is a man who has had no vision. He is a man who has led this province for 12 years with no courage to stick out his neck, without the courage to state whatever fundamental principle he or his government might stand for.

Fourth, I want to deal with this bill in its particulars where this bill exercises discrimination and unfairness.

Fifth, I want to deal specifically with the arbitration sections of this bill. We consider those to be not a mere passing part of the economic and labour relations scene of the province, but we consider they have been a fundamental part of the labour relations scene of this province.

Finally, I want to conclude, when I do some time from now, by dealing with the total lack of economic initiative by this government to try to achieve what my leader has called job justice.

The government of Ontario and the Conservative Party of Ontario have totally rejected Ontario's traditional values. They have totally rejected not only the idea that Ontario can work but the idea that the people of Ontario want to work. That is the greatest failing of the Conservative Party and that is the greatest abandonment of its own principles.

Let me first deal with a few parts of the Treasurer's statement as he announced his program, some 11 days ago I believe. The Treasurer said: "There is no question that our government's action last fall" -- he is referring to Bill 179 -- "contributed to both the dramatic decline in inflation and the economic recovery now under way. This has given us the flexibility to invest in strengthening the recovery by addressing major issues such as new job creation."

Let us take a brief look at some statistics about job creation. In Ontario today, as of September 1983, if we take the recession period starting in August 1981 as 100 for unemployment and compare that to today's figures, we will see the job recovery rate in Ontario as a whole is only 63 per cent; that is, some 37 per cent of the jobs that have been lost since the base month, since August 1981, remain lost and not recovered. We are still without 183,000 jobs that have been lost during the current recession.

Let us take a look at that sector by sector. In the agricultural sector we are still without 22,000 of the jobs lost in the last couple of years. That means there has been a recovery rate of only 67 per cent.

In the nonagricultural primary sector or the resource sector we have only had a recovery rate in those jobs of 33 per cent. In other words, two thirds of the jobs lost in that sector, which has traditionally been the backbone of the economy in northern Ontario, have been lost and not recovered during the recession.

Let us take a look at the manufacturing sector. The job recovery rate in the manufacturing sector in Ontario has been 51 per cent. In other words, 49 per cent of the jobs lost in that sector are still lost and have not been recovered. We are still without 103,000 of the manufacturing jobs that have been lost during the recession. In the construction sector, we are still without 26,000 jobs that have been lost during the recession.

9:20 p.m.

During the debate on interim supply I went on at length about the latest unemployment statistics in Ontario. I plan not to repeat that this evening. However, I want to say to the Treasurer and to the government of Ontario that while there is still double-digit unemployment in this province there is no economic recovery worth talking about. While the people from Thunder Bay to Windsor and St. Catharines continue to walk the streets looking for jobs there is still a depression, in my view.

In this party, we will talk and give the government credit for an economic recovery when there are jobs. As a short-term goal, what I would like to see this government try to pursue in the next year or two is not a six-and-five program, not a five program, not a nine-and-five program, but what I call a five-and-five program. What this means is keeping the inflation rate down to five per cent and bringing the unemployment rate down to at least five per cent. This would be a goal worth seeking in the next 18 months.

I am not unrealistic. I do not expect to magically achieve zero unemployment. However, I say that until the people of Windsor, Toronto, Thunder Bay, Kenora, Kapuskasing, Kingston, Cornwall, St. Catharines and Niagara Falls have an unemployment rate of five per cent, this government and the federal Liberal government have failed in their primary responsibility to the people of this province. So let us hear less talk about a five per cent program and more talk about a five-and-five program -- five per cent inflation and five per cent unemployment in the next 18 months.

I put this out to the Treasurer as a challenge he should undertake, as a challenge his government should undertake and as a challenge Ontario should undertake. It is a challenge which, if given to the people of Ontario in every region of this province, I believe they would respond to.

I want to share with the House some thoughts I have about the failings which the Treasurer did not mention in his opening statement about Bill 179. In Catholic theology, there are things called sins of commission and sins of omission. I suggest that this government is guilty of economic sins of omission.

On the introduction of Bill 179 last September, in all solemnity the Premier rose in this Legislature and said: "The inflation restraint program, which we are proposing today, is but one step in a process to economic recovery. We are currently working on a further series of initiatives designed to generate further employment and stimulate economic activity."

Where have those economic initiatives been? Where were the series of economic initiatives the Premier referred to? A year later, we know what the Premier meant. We know Bill 179 was not just one step in the governments program. We know it was the only step in the government's program.

We know that Bill 179 did not promote economic recovery. Instead, it actually set back the recovery by significantly contributing to the decline in real wages and living standards in Ontario's workers. It reduced their purchasing power and it prevented, in some considerable part, any chance of a consumer-led recovery.

That is why, within the past week or two, we have seen a number of commentaries by economists, by people in the business world and by institutes that deal with economic matters in which they state that they are worried the recovery is faltering a little. There is no money in the consumers' pockets to help generate part of what is necessary for economic recovery, and that is consumer demand.

The government's economic program last year was a punitive one. For those who had jobs, the Conservative government admits it took away their wages. The so-called Inflation Restraint Board not only rolled back settlements but also insisted on paybacks from settlements to nurses and others in the public sector all over this province.

For those who did not have jobs, the Conservative government failed to give them any hope of a job. For those who needed government assistance, the government of Ontario has limited that assistance. For everyone, whether or not they had jobs and whether or not they needed government support, the Treasurer took away their incomes by increasing their taxes.

It is incredible, although it is not surprising, that the Treasurer would now stand in the House and have the audacity to say, "There is no question that our government action last fall actually contributed to both the dramatic decline in inflation and the economic recovery." If that is the level of sophistication the new Treasurer brings to his economic portfolio, then all I have to say is, "God help us all."

There is no economic analyst, no economic research institute, no one of simple, good common sense who would try to defend such a statement, and yet the Treasurer states it as a bare-faced matter of fact. I use the phrase "bare-faced matter of fact," because the other conjunction of words is unparliamentary.

Wage controls had absolutely nothing to do with reducing inflation. Inflation dropped dramatically, not because of wage controls but because the economy went into a tailspin; because what is now being called the great recession knocked the bejabers out of production and consumption in Canada.

If the Treasurer, by taking credit for reducing inflation, is actually taking credit for the recession, then he is welcome to it. He deserves it. The government can claim little for Bill 179, other than that it is an arbitrary denial of human rights, civil rights and due process.

9:30 p.m.

I want for a moment or two to challenge, in the most fundamental way, the easy assumptions of Bill 111 and the Treasurer's statement. I refer to the easy assumptions that have become part of the North American and, if I may say so, the western world's ethic of today with regard to the great recession.

One such easy assumption, which in my view is an erroneous assumption, is that workers, particularly public service workers, are responsible for inflation. I and my party categorically reject that proposal. Another assumption I want to challenge is the assumption that somehow the status quo is okay. I want to challenge the assumption that we have achieved in the western world as much equality, in terms of social or economic justice, as we are ever going to achieve. That is what the assumption of Bill 111 is. That is what the assumption of Bill 179 is. That is what the assumption of the Treasurer's statement is. Those assumptions are wrong.

I also want to challenge the assumption that somehow those working in nursing homes or in the public sector deserve to get paid less simply because they are in some way providing a service, mostly a social service, and they deserve to get paid less because they are in the public sector.

The New Democratic Party says one nurse's aide in a home for the aged does more good for society, does work of more social and economic value, than any flack or hack in the office of the Premier from John Tory to Denis Massicotte, or even to the chairman of the Progressive Conservative Party government patronage committee, Ed Stewart. I say in all seriousness that nurses' aides in Pinewood Court in Thunder Bay do more work of more value than any of those assistants in the Premier's office. They do more fundamental good, and they deserve to be paid for that work.

The fundamental flaw in Bill 111 is that it does not allow, in conjunction with the Treasurer's statement, in any substantial way for a possible catch-up for the workers in the public sector who are at the bottom third of the pay scale.

I do not have the details in front of me, but I remember the case of Marie Mitchell, which we raised in the Legislature last year time and time again. It illustrated the sheer unfairness of the government's legislation and the continued unfairness that she will experience under this legislation. She worked in a nursing home -- I have forgotten the exact location; it was somewhere between here and Guelph, or it may well have been Guelph itself.

Her union had negotiated a two-year contract that actually gave her an increase of 10.2 per cent in one year and 11 per cent in the second year. The base wage they started to work at was somewhere in the neighbourhood of $9,800; so that by the end of the second year, Marie Mitchell's wages would have been up to the astronomical figure of something like $11,100 or $11,200. What Bill 179 did was roll back the second year of that increase by something in excess of $600. What this government did was to rob that woman of approximately $600.

There is no provision in this bill and the government's statement for Marie Mitchell to recover that money, and there is no provision anywhere in the government's economic policy or planning for Marie Mitchell to catch up to a decent standard of living in comparison with other people in our society who are doing comparable work.

She happened to be a single parent. She happened to have a teen-aged daughter. She also happened, just the month before this government brought in that legislation, to have had a rent increase of 34 per cent granted by the Residential Tenancy Commission.

I remember that case without having to pick it out of my files, and I look at this legislation and at this Treasurer's statement and his talk about flexibility and how one can negotiate. How can one negotiate in that small unit of some 20 members or so, as I recall, who are all getting paid about the same amount? What kind of redistribution of wealth is taking place there that genuinely should be taking place?

There is no provision, in spite of the Treasurer's bravado, for catch-up for the Sensenbrenner workers, for the workers at Pinewood Court or for the workers at Thunder Bay's municipal homes for the aged, all of whom have had rollbacks or paybacks.

We in this party believe in a redistribution of income. We believe in fairness. We believe in a fair taxation system. We also believe that in the public sector there should be a fair compensation system.

If there is only one economic pie and that pie is to be shared by all of society and it is limited, then Conrad Black should be eating slices from the same pie as Marie Mitchell. They should not be eating different kinds of pie or different parts in different proportions. They should not be hermetically sealed in two different worlds if we have a society in a province that wants to talk about fairness, justice and economic opportunity.

The fundamental principle of my party is, "From each according to his ability; to each according to his work." We say the work of a hospital worker, of a Marie Mitchell or of a worker at any hospital, school or day care centre across this province is every bit as important, every bit as valuable and every bit as good to the economic and social wellbeing of this country as that of a Conrad Black in the private sector or an Ed Stewart in the public sector. Their work is every bit as good and deserves to be rewarded every bit as well as their fellow workers in any comparable job in private industry.

I want to mention in passing. for a moment or two, what the other opposition party in the Legislature has had to say about the precedent to Bill 111. I want, for a moment or two, to touch upon the position taken by the DPCLPOO, that is the David Peterson Community Liberal Party of Ontario, in its attitude towards workers and to economics.

9:40 p.m.

The one I want to draw particularly to the Legislature's attention this evening is one enunciated by the member for Windsor-Sandwich (Mr. Wrye) in a letter to, I assume, one of his constituents in Windsor, Ontario, when he talked about wage controls last year.

The letter is dated September 8, 1982. I think it is important to get on the record the position as enunciated by the Liberal Party of Ontario at that time.

"The Ontario Liberal Party would impose mandatory controls in the public and private sector." There is no qualification on that. "We believe that there must be equity in our actions and that without controls in the private sector there can be no equity."

Mr. McClellan: What is the date of that letter?

Mr. Foulds: That letter is dated September 8, 1982.

Mr. Rae: Read it again.

Mr. Foulds: That is a mere year and a month ago, a year and two months ago.

Mr. Rae: Read it again.

Mr. Breaugh: Did you say "both public and private sectors"?

Mr. McClellan: What was the phrase again?

Mr. Foulds: Let me read it in its entirety.

Mr. Rae: Did he send it to Chrysler workers in his riding?

Mr. Foulds: He actually sent it to a Ms. Dorothy Montgomery, of 457 St. Paul Ave., Windsor. Ontario. It said: "The Ontario Liberal Party would impose mandatory controls in the public and private sector. We believe that there must be equity in our actions and that without controls in the private sector there can be no equity."

Mr. Breaugh: Wait a minute; "controls in the private sector"?

Mr. Foulds: "Controls in the private sector."

Mr. McClellan: Did it say "controls in the private sector"?

The Acting Speaker (Mr. Robinson): Order.

Mr. Foulds: That is the free enterprise of the Leader of the Opposition (Mr. Peterson), of the Ontario Liberal Community Party.

Mr. McClellan: Mandatory controls?

The Acting Speaker: Order.

Mr. Bradley: That was Nelson Riis who said that, was it not? That was Nelson Riis. I have the clippings.

The Acting Speaker: Order.

Mr. Foulds: No, no. The letter is signed by the MPP for Windsor-Sandwich on September 8, 1982.

Just for a moment or two I want to indicate the member for Windsor-Sandwich was simply following the lead of his leader.

Mr. Rae: That is impossible. That is physically impossible.

Mr. Foulds: It is physically impossible, but mentally twisted though it is, it is mentally possible. On August 17, 1982, a statement issued by the then leader of the official opposition, and I believe in spite of his performance over the last six months still the leader of the Liberal Party of Ontario, said in a statement: "Secondly, I believe no single sector can be singled out."

Mr. Bradley: He would not put Michael Cassidy in the second row.

Mr. Rae: Is that the community branch speaking up? Which branch is that? Is it the teachers' federation branch speaking up?

The Acting Speaker: Order.

Mr. McClellan: Line them all up against the wall.

The Acting Speaker: Order.

Mr. Foulds: "Equity demands that wage controls be implemented across all sectors."

Mr. Rae: Put them all on the rack.

Mr. Bradley: That is what Nelson Riis said.

Mr. Foulds: The real confusion of all that is simply that the Liberal Party of Ontario, the David Peterson Liberal Community Party or whatever, believes it is all right to be unjust as long as you are uniformly unjust.

It is okay to wear the jackboots as long as you put the boots to everybody. That was the position of the Liberal Party of Ontario then; goodness knows what its position is today. As I indicated, I was genuinely shocked to find that the leader of that party thought the matter of arbitration was to be considered as nothing.

Finally, after those two statements by leading spokesmen of the Liberal Party and the member for Huron-Middlesex (Mr. Riddell) --

Mr. Breaugh: The member for Fleck.

Mr. Foulds: -- the member for Fleck, who I believe is running for the leadership of the right wing of the David Peterson Liberal Community Party -- just to clinch it, the member for London Centre (Mr. Peterson) after those statements, and I found this quite unbelievable, said, "We must promote a more enlightened labour-management relationship." Is that not just peachy? Impose wage controls on the workers in the public sector, no controls on profits, no controls on dividends, and, "We must promote a more enlightened labour-management relationship."

Mr. Swart: Do not forget, Jack wants to raise interest rates.

Mr. Foulds: As my colleague the member for Welland-Thorold has pointed out many times, the member for Huron-Middlesex also wants to raise interest rates.

In passing, I could not let the opportunity go by without putting those positions of the Ontario Liberal Party on the record.

Mr. Riddell: No one is taking you seriously. Not too many take you seriously, Jim. If the truth of the matter were known, I think your own colleagues can hardly stand your voice.

Mr. Mackenzie: Keep it up, Jim, we love it.

The Acting Speaker: Order.

Mr. Foulds: I think I am through about a third of my remarks.

The Acting Speaker: Were you planning on continuing the bulk of them at this point?

Mr. Riddell: Ninety-five per cent of it has been BS.

Mr. Mackenzie: What about the letter he was reading? Was that BS too?

Mr. Foulds: As a matter of fact, if somebody did call it BS, I was quoting directly. On a point of privilege, on behalf of the member for Windsor-Sandwich, his fellow colleagues in the Liberal Party have used unparliamentary language about his letter and they should withdraw. They have used it about their own leader's public statements of August 17. I do not know what they call that in the David Peterson Liberal Community Party of Ontario, but in the federal Tory party they call that a revolt. They call that an attack on the leadership. Maybe we are seeing the phenomenon --

Mr. Speaker: Does this have anything to do with the bill?

Mr. T. P. Reid: I thought the member started off by saying he was going to be serious.

Mr. Foulds: Who could be serious when dealing with the David Peterson Liberal Community Party of Ontario? Who could take those turkeys with two right wings seriously?

Mr. T. P. Reid: I thought we were dealing with Bill 111, Mr. Speaker.

Mr. Speaker: It is Bill 111 to which we are addressing our attention.

Mr. Rae: You missed it, Mr. Speaker. He has been right on target every time.

Mr. Foulds: I am just trying to give a little historical perspective about how this --

Interjections.

Mr. Speaker: Now back to Bill 111, please.

Mr. Foulds: I want to return directly to the Treasurer's justification, such as it was, for the inflation restraint program -- I use that term loosely -- as it was designed by the government last year and is continued this year.

On page 2 of his remarks he said: "The inflation restraint program contributed to the fight against inflation in three ways. First, the program demonstrated leadership to the private sector. It signalled our commitment to lower wage settlements and reinforced the downward trend in private sector wage increases."

9:50 p.m.

What utter and complete nonsense. Leadership is being out in front. Leadership is not holding up one's finger to the wind, seeing which way the troops are going and following. Every statistical analysis I have seen indicated private sector wages had been decreasing dramatically in 1982 by the time they brought in the legislation simply because of the man-made depression the federal Liberal government had created, following Reaganomics and Thatchernomics. Private sector wage settlements had been dramatically lower without this punitive legislation on the public sector by this government.

The Treasurer said, "Second, it," the inflation restraint program, "helped control the cost of government by limiting increases in public sector spending, increases that are ultimately passed on to taxpayers and consumers in the form of higher taxes, user fees and charges for government services."

I want to spend a few moments on that claim. Has this government never heard of negotiations? By saying it had to pass the legislation last year, the government is admitting that with its own managerial capabilities it could not control its own budgetary process. could not negotiate without having the extra hammer of legislation.

They are saying they not only lost control and gave up responsibility for managing the economy through any kind of normal budgetary process, but they gave up the responsibility of even managing their own fiscal accounts through the ordinary budgetary or negotiating process. They needed an authoritarian law to give them the extra power they needed.

They became the judge and jury, the referee, the arbitrator when they were one of the players in the game of negotiation between public sector workers and management. They were the management. Because as a government they did not base the skills or the guts to manage their own fiscal budget let alone the economy, they imposed that kind of legislation. They changed the rules of the game in midstream to make it easier for themselves.

Yet they did increase the taxation. What was it called, the social assistance support tax, the social assistance tax? They increased their fees. They did this so they would not have to pass on higher taxes, user fees or charges for government services to the consumers and the taxpayers.

They did pass on higher taxes. They did pass on user fees. They did pass on charges for government services. They increased the Ontario health insurance plan fees. They instituted charges for pamphlets they used to give away free in the Ontario Government Bookstore. They did all kinds of things. In other words, they did not keep the promise of keeping down taxes or user fees.

"Third," the Treasurer said, "the program helped reduce government demands on capital markets, thereby easing the pressure on interest rates." I want to suggest to the Treasurer that one of the ways this government could ease up some capital for the markets in Ontario would be to ease up on its obsession with unnecessary megaprojects such as the North Darlington nuclear station.

If there could be $12 billion available in the public and private markets for borrowing, think about the kind of investment that could take place in the manufacturing sector and in developing secondary and alternative industries in northern Ontario. Think of the kind of mortgage money that might become available for home construction. We could have 200,000 mortgages for $50,000 homes from the capital that would be available if this government gave up its obsession with megaprojects such as the nuclear plant at Darlington.

I would suggest to the House that in terms of job creation, as well as in terms of the Treasurer's words "easing the pressure on interest rates by reducing government demands on capital markets," there would be more jobs available by investment in the construction industry for home and residential construction and there would be more jobs available in the manufacturing sector if we had that kind of investment.

I now want to turn specifically to some of the concerns we have about Bill 111. I do not want to delay this debate unduly, but I do seriously want to put forward a number of the concerns that have been brought up in the last few days by arbitrators concerned with the arbitration process.

Let me for a moment just contrast Bill 179 and Bill 111 and lead in directly to what I want to say about arbitration. My understanding is that other members in my party will be dealing specifically with that item.

If the government members are worried about the length of my speech, they need not. I think I can happily contain my remarks within an hour and a half.

First, in general, Bill 179, the Inflation Restraint Act, 1982, which preceded Bill 111, imposed mandatory limits on compensation increases of up to nine per cent during the transitional year and five per cent during the control year. The control year was variable, depending upon the date the previous collective agreement expired. Thus, it commenced some time between October 1, 1982, and September 30, 1983, and will conclude some time between October 1, 1983, and September 30, 1984.

10 p.m.

Clause 13(b) of the predecessor of this bill, Bill 179, the Inflation Restraint Act, also purported to suspend collective bargaining on nonmonetary matters for the duration of the transitional and control periods, together with the right to strike in arbitration except in respect of first agreements.

This feature of the Inflation Restraint Act has recently been declared unconstitutional by a three-zip decision, a three-to-zero decision of the Ontario Supreme Court, as contrary to the Charter of Rights. An appeal has been launched by the Ontario government to the Ontario Court of Appeal, but frankly I think that is largely show.

Following the Ontario Supreme Court decision that limits on collective bargaining contained in the Inflation Restraint Act are, in part, unconstitutional, the Ontario government decided not to extend that act but instead introduced Bill 111.

However, the government is seeking indirectly to achieve the same goal of restraint by (1) limiting funding to public sector employers for wage increases to five per cent, (2) closely monitoring collective bargaining in the public sector to determine whether settlements or awards exceed the government's five per cent criterion, and (3) requiring arbitrators to take into account the employer's "ability to pay in the light of existing provincial fiscal policy" so as to ensure that this year's restraint program be reflected in arbitration.

One of the difficulties is that we have never had a statement of fiscal policy by this government. The other thing is the fiscal policy of the government can be a movable feast. What we have here is a dictatorship by press release, which is subsequently given the gazetting procedure every Saturday after the Treasurer has made one of his off-the-cuff or on-the-cuff statements.

Second, the bill constitutes a sharp departure from the tradition that arbitrators as adjudicators of disputes between governmentally funded employers and their employees should be independent of government. As impartial third parties, arbitrators are not answerable to the government; yet under Bill 111 they are required to justify their awards in the light of "existing provincial fiscal policy."

In this respect, arbitrators are not free to cost their awards in the manner that is most fair and objective, but must use whatever methods are specified by the government, even though they may completely disagree with the assumptions upon which the government costing methods are based. To the extent that the independence of arbitrators is undermined, it is to be expected that the confidence of workers and their unions in the fairness of the arbitration process will be eroded. In such circumstances, it will become more difficult for the government to justify the removal of the right to strike.

During the course of the debate, both my colleague the Labour critic for this party, I believe the member for Hamilton East (Mr. Mackenzie), and the leader of this party will elaborate on that item.

In his statement to the Legislature, the Ontario Treasurer said "this transitional year marks a move away from comprehensive controls and towards a more flexible approach to wage and price determination in the public sector." On the other hand, the Treasurer warned that "if there is no evidence of realism or responsibility, we will have learned that the problems in public sector pay determination are more fundamental and more deep-rooted than we now believe."

Unstated, but definitely implied in the strongest possible way, is what the government would do in such a contingency and whether any attempt directly to interfere with collective bargaining would be a violation of the Charter of Rights in the circumstances prevailing at that time.

I want to deal head on with this whole concept that the Treasurer is now instructing the arbitrators of this province that they must take into account the ability to pay. Does this not sound responsible? Does it not sound very plausible? Should the ability to pay not be taken into consideration?

I want to quote from a couple of decisions which I think could fairly consistently and fairly meaningfully counter that argument. First, Judge Anderson, in the Ryerson Polytechnical Institute decision, volume 4 of the Labour Arbitration Cases, page 9, said simply: "An arbitrator should not make decisions based on budgetary limitations and priorities set by the government. Otherwise, he would not be completely independent, as he always must be."

Arbitrator H. D. Brown, in the same case, said: "While the ability to pay is a factor to be considered in many situations, it does not have the same force or effect in public institutions and is not a proper basis to restrict an arbitration, which must be made on objective facts."

Third, Commissioner D. L. Johnston, who conducted a commission of inquiry on behalf of this government in 1974 looking into the whole question of arbitration, said this: "In our view, government guidelines or ability to pay have no place as criteria for settling hospital compensation. Supporters of such criteria argue that as ability to pay is a factor in private sector bargaining, it is also relevant in the quasi-public sector. We consider the comparison invalid because the absence of product market forces of supply and demand in the public hospital sector and of the strike and lockout sanctions strip the ability-to-pay concept of any meaning it may have in the private sector."

I think perhaps the most concise and important statement of principle, from my layman's point of view, was that by arbitrator Owen Shime in the British Columbia railway arbitration decision of June 1, 1976. He said: "Public sector employees should not be required to subsidize the community by accepting substandard wages and working conditions. On balance the total community which requires the service should shoulder the financial loss and not expect the employees of the industry to bear an unfair burden by accepting wages and working conditions which are substandard. If a community needs and demands the public service, then the members of the community must bear the necessary costs to provide fair and equitable wages and not expect the employees to subsidize the service by accepting substandard wages."

I think this is an important principle which we should always have before us, particularly when we are considering this legislation.

Arbitrator Kenneth P. Swan in the Kingston General Hospital decision, June 12, 1979, said: "The decision as to whether a specific service should be offered in the public sector or not is essentially a political one, as is the provision of resources to pay for that service. Arbitrators have no part in that political process, but have a fundamentally different role to play, that of ensuring that the terms and conditions of employment in the public service are just and equitable."

Arbitrator M. Teplitsky in the Service Employees' International Union award, June 19, 1978 -- and I will only quote part of it -- said: "However, these -- and "these" are public service employees -- "cannot be expected to subsidize a higher level of care than we as a society can afford or are prepared to pay for by receiving less than appropriate wages."

10:10 p.m.

In terms of government's responsibility, arbitrator Innes Christie in the University of Toronto decision, February 13, 1981, said: "Interest arbitrators in the Canadian public sector have not allowed governments as employers to hide behind their own skirts in their role as the source of funds."

Basically, that is what this government is doing. It is hiding behind its own skirts to escape pay increases indicated by other criteria. The accepted view is that to allow government underfunding to justify the payment of substandard wages is to ask public sector employees to subsidize the rest of the community.

Finally, I think it is fair to say that arbitrators have justly, time and time again, sought the ideal of comparability as the chief criterion to be applied, and it has been applied by virtually all arbitrators as the most important criterion in the determination of public sector wages.

Other speakers in this party will deal more fully with the question of arbitration, and particularly with what I thought were the very courageous remarks made last evening by Mr. Teplitsky to the Ontario Labor Law Association. I will not go into those in detail this evening. I simply want to conclude this way.

Mr. T. P. Reid: Any way you conclude is fine.

Mr. Foulds: I think I have five or 10 minutes in conclusion. I want to say Bill 111 is not an economic program. It is not even part of an economic program. It has nothing to do with economic recovery. Bill 111 is an arbitrary and punitive reaction by a government without direction. Ontario is in the midst of an economic crisis previously unknown in this province. Our resource sector is in disarray, our manufacturing sector is limping and our public sector is squeezed.

Hundreds of thousands of people -- almost half a million people in this province -- are without jobs. A generation of youth is without opportunities. Yet all the government can do is resort to another conjuring trick, making a mountain out of a molehill in order to hide the real problems the province faces. In the last few months this government has gone chasing a rainbow by giving far too much credence to the small signs of economic recovery.

At the present time more than 160,000 men and women in Ontario have been unemployed for seven months or more and 95,000 of them have been unemployed for more than a year. That is simply not acceptable. Further, the average length of unemployment for those workers aged 45 and over has increased from the start of this recession from 19.2 weeks in 1981 to 28.4 weeks in 1983. That is a dramatic and unacceptable increase.

To those people who are unemployed, the claims by the Treasurer of an economic recovery ring hollow. The Treasurer is aware of the changing economic world. He knows the General Agreement on Tariffs and Trade reductions have fundamentally changed the economics of branch plant production in Canada.

The Treasurer knows the rise of the newly industrialized countries of Latin America and the Pacific Rim, the maturing world markets for steel, autos, airplanes, traditional consumer electronics and so on, as well as the rise of low-wage enclaves both in the Sunshine Belt of the United States and in free trade zones throughout the world, represent a direct and tangible threat to Ontario's workers.

The Treasurer should also be aware of the confidential report, entitled the Rocky Road to 1990, that was prepared by the Ministry of State for Economic Development and subsequently leaked to the press. That report states, "It is now becoming increasingly apparent that many of the jobs that have been lost will not be recovered when the overall economy recovers."

The report goes on to say, "The impact of structural change is likely to be felt most in southwestern Ontario." Yet we have nothing from this Treasurer to deal with the fundamental problem of creating jobs in the industrial heartland of this province.

The report makes the point that the extent of structural change will be substantial. It concludes: "One quarter to one half of the 1981 jobs in manufacturing could be lost by 1991. Also, up to a quarter of existing jobs in business and financial services could be lost."

Even if we conclude that those figures are a worst-case scenario, the point remains that job loss, layoffs, long-term unemployment and plant closings have become a permanent feature of Ontarios economy in the late 1970s and early 1980s. That has happened under the management of the Progressive Conservative Party of Ontario and under the management of the member for Brampton (Mr. Davis) as Premier, and it is some record and some inheritance to leave to the people of Ontario.

This is the situation that confronts Ontario. It is precisely the situation that the Treasurer has ignored and his predecessor ignored. Instead, the Treasurer with this bill shifts the responsibility of the provincial government to municipal governments, school boards and agencies at the local level.

The Deputy Speaker: Could the member for Fort William (Mr. Hennessy) hold his comments down?

Mr. Hennessy: It is not my fault. He is giving me an argument.

Mr. Foulds: Is he giving the member for Fort William an argument? The member should fight back. Come on, the member for Fort William knows how to do that. He should take him out in the hallway.

The Deputy Speaker: The member for Port Arthur will continue.

Mr. Foulds: Not only has it shifted its responsibility to the local level, but this government has also shifted its fiscal problems and the burden of carrying the provincial government services on to the shoulders of the workers and particularly the workers in the public sector of this province. I do not care how much lipservice this Treasurer, this Premier and the Treasurer's predecessor give to the public service of this province; this Conservative government has kicked the public service of this province in the teeth in the past two years.

This bill and the Treasurers statement are a totally inadequate response to the people of Ontario. The government had the opportunity to implement an economic program in the last budget, but instead it imposed hardship on Ontario families.

Mr. Speaker, recall the $60-million increase in the Ontario health insurance plan; recall that in the past three years OHIP premiums increased by 42 per cent; recall the new tax imposed in the last budget, the so-called social services maintenance tax, which will take $340 million out of the pockets of Ontario families; recall the increase in personal income tax in the two years preceding the introduction of the new maintenance tax; recall how little was done to stimulate the economy, and recall what little was done to create jobs in this province. Recall too that since the last election, this government has increased personal income taxes by about $600 to $700 a year, and remember what little the Conservative government of Ontario has given back to the people of Ontario for those increased taxes.

10:20 p.m.

The Treasurer has said he is committed to a recovery built on investment, but the fact is that despite the grants, the tax giveaways, the federal budget and the last provincial budget, an investment-led recovery is not yet on the cards. What little recovery we have had is due to consumer spending, not to investment spending. That recognition should lead to particular programs on the part of the government and it should cause the Treasurer to review the previous budget and make the necessary changes. It should cause the government to abandon its Bonzo Reaganomics in favour of a coherent set of economic initiatives.

Last spring this party released a job creation package entitled Ontario Can Work. We believe that with every fibre of our being: Ontario can work and it wants to work. This fall the government and this Treasurer had the opportunity to bring in a mini-budget that would put some of those programs in place.

I want to suggest that before the winter sets in the government should take the following five steps.

1. It should announce the abandonment of its social services maintenance tax and return those moneys to Ontarios consumers.

2. It should enrich its own capital spending program.

3. It should implement the comprehensive energy conservation program that was announced as far back as 1980 as an energy policy for the province by the then Minister of Energy.

4. It should announce a housing construction program, particularly in the family public sector of housing for which there is a crying need and waiting lists that are simply unconscionable in every major community of this province.

5. Before this House rises, this government and this Treasurer should announce a winter works program through municipal government so that municipal governments can take off the shelves throughout the regions of this province programs they have had to shelve because of the restraint of spending by this government.

Those projects are worthwhile projects that cover everything from educational institutions and day care centres to hard programs such as municipal water works and filtration plants.

In short, there is a long list of opportunities, but what this government has done is to miss those opportunities. Instead, it continues to bash workers, it continues to scapegoat the victims to cover up its own desperate failures, its own abdication of responsibility and its own abdication of leadership.

The Deputy Speaker: We thank the member for his remarks. The member for Essex North.

Mr. Ruston: Mr. Speaker, in view of the hour, I wish to move the adjournment of the debate. There are only five minutes left; it is hardly worth while starting.

On motion by Mr. Ruston, the debate was adjourned.

The House adjourned at 10:25 p.m.