Journal des débats 1993-juin-29 | Assemblée législative de l'Ontario

Mr John C. Cleary (Cornwall): It was with much fanfare that the Minister of Culture, Tourism and Recreation announced a new tourism strategy last week. She said the focus of the announcement was to recognize the role that the $16.9-billion industry plays in the provincial economy and build alliances and coordinate activities of tourism partners.

While this sounds like a very interesting gesture, in my riding we are getting a very different message from the minister. Specifically, the Tourism ministry announced a while back that it was closing five campgrounds in eastern Ontario. Just this summer, it was revealed that two more parks would cease operation.

While this news has had a devastating effect, I was vastly relieved when the former minister said it was his business to keep parks open and that he was willing to consider outside proposals to maintain the parks. In fact, the minister stated in March 1991, supported by the current parliamentary assistant: "We are trying to open the parks. We are doing everything we can to look at available options, and hopefully we will have something in the near future."

With this type of supposed ministry support, combined with an ongoing and significant interest on the part of the private sector, it would seem that opening the parks should be a done deal. Nevertheless, some of the parks remain closed, and I have heard many people say that the fault lies at the feet of the ministry.

If the minister were truly interested in a viable tourism sector in eastern Ontario, she would ensure realistic negotiation for the potential investors, rather than continue to obstruct tourism in eastern Ontario.

WATER SUPPLY

Mr Bill Murdoch (Grey): The council of the county of Grey has asked me to arrange a meeting for it with both the Minister of Municipal Affairs and the Minister of Environment and Energy to discuss its concerns with water taking. They wish to consider necessary changes to the Planning Act which would provide local municipalities with appropriate controls over licensees' operations.

Water taking from wells for commercial purposes has been going on for some time in Grey, but now that bottled water has become a major industry, we wish to ensure that there will always be an adequate supply of clean water for the residents of our area.

While we have not seen any detrimental effects thus far, it may be that zoning laws will be required in the future to ensure public input and local acceptance before permits are issued. It may also be that permits should be given for a limited time frame only and that inspections and assessments be done before a renewal is issued.

Clean, clear water plays a significant role in maintaining aquatic life and associated ecosystems. We wish to ensure that this vital resource is protected for the wellbeing of our children.

To this end, I would request that both ministers find the time in their busy schedules to look into this situation, to assess the needs of both the people of Grey and the local commercial ventures and to effect a reasonable broad water policy which will enable business to function and which will ensure the continuance of an abundance of water for the generations to come.

ST JOHN AMBULANCE

Mr Drummond White (Durham Centre): It gives me great pleasure today to rise and mark the 30th anniversary of the St John Ambulance in Whitby.

The St John Ambulance has been an active member of the Whitby community, not only in times of crisis but also at fairs, sports events and public gatherings. The presence of their ambulance and personnel is very comforting and ensures that highly professional, competent care is readily available should the need arise.

Of their current voluntary membership of 123, 119 members are trained to assist with casualty care in crises. St John Ambulance works tirelessly with service groups and youth groups, such as scouts and guides, as well as the general public, to teach and to certify first aid. It's estimated that one out of every 13 Whitby residents has been trained by St John.

The St John Ambulance service is also a good corporate citizen. They participate in civic events and are even cooperative education employers.

St John Ambulance has been unaffected by the latest recession. They rely on donations for their operations, and donations have been forthcoming even though these are very difficult times. I am pleased to say that in these rough times they have survived and are looking forward to the challenges of the future.

I thank them for choosing to stay in Whitby and congratulate them on their 30 successful years.

DISTRICT OFFICE RELOCATION

Mrs Joan M. Fawcett (Northumberland): Last Friday I met with Rick Blakey, president of Local 335, and Peter Dashfield, the OPSEU staff rep. They are most concerned with the Ministry of Transportation's decision to cut services from an area that is responsible for 275 kilometres of freeway and a population of 261,000 and move it to an area that has no freeway and a population of 62,000.

They want to know what will be done at 3 am in the winter when a plow breaks down, now that you have shut down the Port Hope garage. The Port Hope office used reclaimed sand for the roads; both Bancroft and Kingston use salt. Will these offices now use cost- effective and environmentally friendly sand? Why was the savings, offered by employees, of $500,000 in winter works projects ignored?

How much will it cost to move employees when you consider they get the cost of a home and moving expenses? What will you tell Dave Strong, who has worked with your ministry for 33 years only to be handed separation papers with no notice last week? How can you properly redeploy all these people when the counsellors you sent only had a two-day crash course and can't even answer employees' questions?

The sign shop at the Port Hope district office is considered the most cost-effective in production and erection in the province. Now they're being put out of business and work they do is on hold till who knows when. Today my office was contacted urging me to have the Big Apple Drive signs done. They have been told production has been stopped due to your cuts.

How can you justify these cuts? What feasibility study was done? What impact and cost analysis was done? Can you produce documents to verify this measure? If not, as I suspect, will you put your decision on hold?

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TAX INCREASES

Mr Cameron Jackson (Burlington South): Birthdays have always been a time of happy celebration and gift giving, but in Bob Rae's Ontario this tradition is being reversed.

On July 1, Canada's birthday, NDP Treasurer Floyd Laughren will take millions of dollars from the pockets of already overburdened Ontario taxpayers. On that day, the NDP will begin collecting a full year's worth of tax increases over a six-month period, retroactive to January 1, while raising Ontario's personal income tax rate three percentage points, to 58% of the basic federal tax. Provincial income taxes will now be at 61% of the federal rate. New fees and fee increases will pull another $220 million into the NDP coffers.

It is small wonder that Ontario citizens have begun to establish taxpayer coalitions across the province to articulate their concerns about the lack of accountability in public spending. Ontario property taxpayers have had to shoulder the burden of increased education costs. Hundreds of millions of dollars are also being lost annually due to the government's refusal to make our social assistance and health care systems more accountable.

I am pleased to greet today in the Legislature Mr Frank Gue, the president of the Halton Taxpayers' Coalition, together with members of his executive, Barb Newham, Roger Love, Leo Haber and Niel Howie.

The goals of the coalition are to obtain value for tax dollars in public spending, to eliminate waste in public spending and to encourage elected representatives to make responsible judgements concerning these issues. It is my hope that the Premier and Treasurer are listening to their message. The taxpayers have had enough, and they deserve to be listened to.

JAEMI AND TAELOR DOUGLAS

Mr Derek Fletcher (Guelph): On March 22, 1993, Chris and Geoff Douglas of Burlington, Ontario, became the proud parents of twin girls, and big sister Sierra became the responsible, proud big sister of these twins. Jaemi Nicole weighed in at five pounds nine ounces and arrived about 3:35 pm, only to be followed immediately and very impatiently by Taelor Jordan, weighing in at six pounds 10 ounces, about three minutes later.

Proud of this occasion are the grandparents, Doreen Bauer and Mac and Connie Douglas of London, Ontario, and my good friends Alan and Diana Kalinowski of Ilderton, Ontario, and also the great-grandparents, Josephine Kalinowski of London, Merle Bauer of Goderich and Selma and Maurice Klumpp of London.

The twins and the family are doing well, and I believe the grandparents have their feet on the ground. We wish everyone the best for the future.

SOCIAL CONTRACT

Mrs Elinor Caplan (Oriole): Today I'm calling on Mike Harris and the Tories to vote against Bill 48 on third reading. During second reading, the Conservatives supported the social contract legislation. Harris and the Conservative caucus have tried to have it both ways. They've spoken out of both sides of their mouths. First, they bashed the unions and then criticized the government for union bashing. Harris said the $2 billion in cuts wasn't enough and then he accused the NDP of going too far to get the $2 billion.

Before the second reading vote, I repeatedly asked the Conservative caucus to join Lyn McLeod and the Liberals and to vote against Bill 48. Unfortunately, they did not take my advice. But I'm an optimist, and I believe there is still hope. We've seen Mike Harris change his mind before. Do it again, Mike.

Perhaps you'll listen to the words of the Board of Trade of Metropolitan Toronto. They have great concerns about the future cost of this legislation. Here is what they say: "The entire structure and functioning of Ontario's public sector will be irrevocably changed for the worse." Another quote: They say this legislation "poses a serious threat to private sector employers who provide services to government on a contract basis." They say about this legislation that it is "liable to serve as a deterrent to future private business investments in this province."

I say to the Conservative caucus that bang, bang, bang is bad, bad, bad. This legislation is fundamentally flawed. Do the right thing: Join the Liberal caucus and help us to defeat Bill 48.

HIGHWAY SAFETY

Mr David Turnbull (York Mills): This morning I was happy to sponsor a press conference at which the Ontario Safety League, the Driving School Association of Ontario and the Road Safety Educators' Association announced a step forward in road safety.

As of July 1, 1993, the Driving School Association of Ontario becomes the approving agent of driving schools whose courses will be recognized by the insurance industry through premium discounts offered to graduates.

This is the first time that the driving school industry has attempted to speak with a common voice. The move towards self-regulation is a commendable one, and the effort to promote quality and uniform standards within the driving education industry deserves praise.

The work of those involved in establishing this coalition of road safety educators should be commended. This is a model example of cooperation within the road safety industry, as the coalition includes representatives from a variety of road users, including cyclists, automobile drivers and truckers.

Congratulations to the members of the coalition for taking this initiative and advancing the interests of all road users by focusing on road safety through education. Given that over 1,100 people are killed each year on our roads and highways, any step to end this carnage must be encouraged. Raising awareness and changing attitudes through education is the best way to achieve safety on our roads and highways.

CANADA DAY

Mr Gary Malkowski (York East): In celebration of Canada Day, East York will be holding its 26th annual Canada Day festivities this Thursday. Included in these events is a Canadian citizenship court being held at the East York Civic Centre, a motorcade from Howard Talbot Park to Dieppe Park and a parade marching through East York, ending at Stan Wadlow Park, where a variety of activities are planned.

I am pleased to again be able to participate in this wonderful community event. The involvement of so many local organizations is a reflection of the close-knit community that East York represents.

At my booth this year I will be making available tree seedlings for a small donation to the Conservation Foundation of Greater Toronto. As part of its 1993 fund-raising campaign, the foundation is attempting to raise $500,000 from the private sector. These funds will be used, along with other sources of funding, to begin the rehabilitation of the Don Valley brickworks, a site located in my riding. The brickworks, as many of you are aware, was acquired by the Metropolitan Toronto and Region Conservation Authority in 1989 and is designated as an area of natural and scientific interest because of its historical, environmental and geological significance.

I hope that in your own communities you have the same opportunity to participate in such a worthwhile activity, and I wish you a happy Canada Day.

VISITORS

The Speaker (Hon David Warner): I invite all members to welcome to our chamber this afternoon, seated in the Speaker's gallery, the Honourable Bruce Anthony Chamberlain, the president of the Legislative Council, Melbourne, Victoria, Australia. He is accompanied by his wife, Mrs Chamberlain. Welcome to our assembly.

ORAL QUESTIONS

SOCIAL CONTRACT

Mr Murray J. Elston (Bruce): I am surprised that the Treasurer is not here today. We're getting so close to the biggest tax grab in our provincial history.

I noticed, by the way, and the Premier probably knows this, that they're erecting three booths out in front of the treasury offices even now as we speak. I presume those are probably to take in the extra money they're going to take from all the people starting July 1.

But my question is to the Premier. I'd like to ask if the Premier would -- sorry, the Premier seems to be otherwise occupied at the moment, looking for his answers. He's ready now, I'm sure.

On previous occasions my leader, Lyn McLeod, has asked the Premier to tell the people of the province how his very badly assembled Bill 48, the social contract bill, will operate in certain sectors of our economy. She asked him about how it would affect teachers' salaries and specifically what it would do to the grid system. She asked to have him explain how the redeployment of people laid off as a result of the social contract would work. She asked about the special leaves, the 12 days off for critical activities. She asked about exemptions from the program, and she asked about the effect the social contract would have on Ontario Hydro.

I'm asking the Premier, will he today answer those questions?

Hon Bob Rae (Premier): This is question period, and I'll be glad to answer any specific questions that are put to me to the very best of my ability.

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Mr Elston: Basically, what he has said was that he wants to gloss over all of those errors in his bill. He doesn't want to answer any of those questions at this point. He could have chosen to answer anything about the teachers' grid, he could have chosen to answer any of those other items that I listed, but let me give him one single issue for him to address so that he can specifically tell us what he thinks the effect of his legislation will be.

While members of labour organizations have said they'd no longer support his program, while the Board of Trade of Metropolitan Toronto says it no longer supports his program because it is flawed, let him explain to the people who work and who are working at Ontario Hydro, even as we speak, on their expenditure control program, which they implemented long before he started his, let him explain how the social contract's new target of some $100 million will affect not only the workers and the people at Ontario Hydro, but the rates that are to be paid by the people who use electrical power in this province. Will he do that?

Hon Mr Rae: I think I can answer at least part of the question. First of all, the rate proposal that's been put forward by the board at Ontario Hydro, which provides for no rate increases next year, stands.

Mr Elston: That was before you asked them for $100 million.

Hon Mr Rae: No, I'm sorry. I'm being heckled mercilessly by the member. It's very hard to --

Mr Gregory S. Sorbara (York Centre): It's over you, Bob.

The Speaker (Hon David Warner): Order.

Hon Mr Rae: And another one, the member for York Centre, who is absolutely brutal, sitting in his new seat which he himself has referred to as the ejection seat.

I would say in answer to the member, and I've discussed this directly with the chairman of Ontario Hydro, that Ontario Hydro has gone through and is going through a major restructuring and is in the middle of very intensive discussions with its own employees with respect to restructuring and with respect to the impact of this restructuring on the workplace.

What we have said is that with respect to the government's legislation and with respect to the approach that's being taken, in any negotiation the amounts that have already been negotiated by Ontario Hydro will be fully credited to Ontario Hydro and will be fully taken into account in terms of assessing what the bottom line is. The government does not want to do anything which would negatively affect or impact Hydro's financial integrity and its ability to meet its own targets, which are exceptionally important.

The Speaker: Final supplementary.

Mr Steven W. Mahoney (Mississauga West): To the Premier: I wonder if I could ask you a very specific direct question along the same lines as the member for Bruce has just done. It has to do with the 12 days that you have suggested municipalities negotiate with their workers to find their savings.

You've admitted, and I think would agree, that in many cases the municipalities are finding a shortfall, that the 12 days simply do not generate the savings, the target that you've asked for. These municipal people have gone to the staff in the Ministry of Municipal Affairs, they've talked to Bill Freeman, policy adviser to the minister, he's referred them to Nancy Bardecki in financial services and Miss Bardecki has given them advice, one of four options.

The first option: If it doesn't meet the target, negotiate more than 12 days. Even though the legislation doesn't allow for that, negotiate more than 12 days. The second option is service cuts. The third option Miss Bardecki has suggested is layoffs. You have said you don't want either service cuts or layoffs. The fourth option, interestingly enough, that Miss Bardecki has given to the municipal sector is to increase property taxes.

Premier, will you confirm that those are the four pieces of advice being given out by senior staff in Municipal Affairs, and which one of those options do you recommend, sir?

Hon Mr Rae: I wouldn't tell a mayor how to run his shop in terms of those kinds of decisions.

Mrs Elinor Caplan (Oriole): You have. That's what Bill 38 is all about.

Interjections.

Hon Mr Rae: What we're providing is legislation which provides a framework and provides an ability on the part of employers and employees to come together and to reach conclusions. There's no one single answer with respect to what we're putting forward. If you say that it could be all of the above, I would say to the honourable member that the mix of options that are chosen and negotiated is precisely the one that your own leader, three or four days ago, was standing in her place and saying, "Give to the local municipalities the power to reach agreements that they can reach." Then we say, "That's exactly what we're going to do," and you turn around and say, "You mustn't do it."

The Liberal Party can't have it both ways. You have to deal with and recognize the problem. If you agree with the need to save $2 billion, if you're going to go around and say to business, "Yes, we're championing your cause," if you're going to turn around and say to labour, "Yes, we're championing your cause," make up your minds. Get off the fence and tell us where you stand on this question of expenditure reduction, because you're not even in the ballpark.

AIR QUALITY

Mr Steven Offer (Mississauga North): I have a question to the Minister of Environment and Energy. I'm informed that he was to be here. He is not yet here. Is he coming? If he is, I will stand down my question to the minister.

Mr Tony Ruprecht (Parkdale): The door just opened. He may be on his way if you're lucky. The door just opened and he has arrived.

The Speaker (Hon David Warner): The member for Mississauga North has the floor. He may wish to place his question now.

Mr Offer: Thank you, Mr Speaker. That got the Minister of Environment and Energy out. I'm wondering how many are back there right now.

My question is to the Minister of Environment and Energy and it concerns your lagging commitment to improving air quality, especially in the area of low-smog gasoline.

You will know that nitrogen oxides and volatile organic compounds are the major precursors to smog pollution. Approximately half of the nitrogen oxides and volatile organic compounds present in the atmosphere today are emitted by automobiles.

Pollution Probe has indicated that Toronto is not only the smog capital of Canada; it has an air quality that is worse than some major cities in the United States, including Chicago, Atlanta and Boston. As you know, summer has traditionally been the worst season for smog pollution in this province, and this year residents can expect it to be no different.

What are you and your government doing to prevent smog pollution which is being emitted largely by automobiles in this province?

Hon Bud Wildman (Minister of Environment and Energy and Minister Responsible for Native Affairs): I want to apologize to the House. I was dealing with a matter related to a first nation. It came up as an emergency; otherwise I would have been here.

Mr Gregory S. Sorbara (York Centre): Oh, my, what a busy minister.

Hon Mr Wildman: It was an important matter.

The member raises a very important issue with regard to ground level ozone. There is no question that the automobile is the main contributor to NO_x and this is a problem, particularly in the summer months. We are currently working on regulations that will be coming forward in due time. I would say to the member that I appreciate his question and I would certainly look forward to giving him further information on the supplementary.

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Mr Offer: I would hope that the minister would have been quite well aware of this very important problem, especially as it affects health. I think you should be aware, from your previous response, that the only conclusion one can draw through watching these parliamentary proceedings is that your government is doing nothing.

I think we have to recognize that the human health effect of ground-level ozone is an increase in breathing disorders such as coughing, wheezing, decreased lung function and increased mortality rates. According to the Lung Association and Pollution Probe, the most at risk are people with chronic heart and respiratory disease, the very young, the very old and also people who exercise vigorously when ground-level ozone is high.

I would like to remind you that when we were in government we took action. The member for St Catharines, when Minister of the Environment, took action to reduce smog emissions from automobiles as a first step within our overall strategy to improve air quality throughout the province.

Since you have been in government you have done nothing while other jurisdictions such as British Columbia, the northeastern United States, such as New York, New Jersey, Massachusetts and other states such as California, all have enacted stricter regulations than are now in existence in this province.

We need action. Will you give a commitment today that you will immediately pass a regulation requiring further restrictions on low-smog gasoline as part of a larger strategy to improve air quality in this province and for its citizens?

Hon Mr Wildman: I appreciate the member's question and I would reiterate that we are indeed working on a regulation. I'm sure that he and his party would not want us to immediately pass a regulation without proper consultation. That would be most inappropriate. Obviously, we need to consult with Pollution Probe and other environmental groups as well as members of the fuel industry and the automobile industry and municipalities, to ensure that we have a regulation which is appropriate.

I think it's unfair of the member to suggest that this government has done nothing when one recognizes the tremendous commitment this government has made to urban transit, which is designed to get people out of the automobile and into urban transit as a way of dealing with our environmental difficulties.

Mr Offer: The minister indicates that they do not want to rush into a regulation. For three years, this government has done nothing. They put a new definition to the meaning of "rush." I would like to remind the minister that in 1991 your predecessor signed a national agreement with every provincial minister of the environment and the federal government as well. That agreement committed your government, two years ago, to implementing a plan to reduce smog pollution in this province of Ontario and with other ministers throughout the country of Canada.

Your government has done nothing. In your inaction in implementing the provision of this initiative you have, I believe, breached this agreement. I believe you have to explain to the members of this Legislature and to the people in this province why you have breached a plan signed in 1991, a plan which would have committed your government to action in this very important area.

Hon Mr Wildman: The member should know that this government will live up to its commitments.

The Speaker: New question, third party. The member for Carleton? Is there anyone from the third party who wishes to place a question? The member for Leeds-Grenville.

Mr Gary Carr (Oakville South): On a point of order, Mr Speaker: I would like to say I think we're okay to go now. The leader's ready for his question.

The Speaker: Very helpful.

Mr Michael D. Harris (Nipissing): That was one of the more appropriate points of order I've heard in a long time. Some of them really aren't points of order at all.

SOCIAL CONTRACT

Mr Michael D. Harris (Nipissing): My question is to the Premier. As early as tomorrow, we may be proceeding with the next stage of the social contract legislation in committee. In that regard, Premier, this morning I shared with you some of our draft amendments in the hope that changes to Bill 48 will address the principles that we want to see met.

My caucus believes that restraint legislation in its final form must permanently and structurally reduce the size and cost of government, not just be a quick fix. Your caucus, I know, had some time this morning to discuss the intent of those amendments and your amendments. Indeed the board of trade has put forward identical amendments to ours in a very responsible, constructive way to make Bill 48 workable. I commend them for that too.

Can you tell me the thinking of yourself and your caucus with regard to those amendments and, secondly, do you agree that with whatever language we end up, whatever amendments and whatever language, the goal is at the end of the control period there will be no snapback provisions, no ballooning provisions, no contingent liability on any of the employers across the province? Would you agree with that?

Hon Bob Rae (Premier): First of all, let me say to the honourable member that I appreciated getting a copy of the discussions, the proposed amendments, and I gather from the covering letter that there may in fact still be others that will be forthcoming. I don't know, but there was that indication. I would say that we take those amendments very seriously.

With respect to what's being suggested --

Interjections.

Hon Mr Rae: Again, Mr Speaker, the noise level is so high, I think I'll have to --

Interjections.

The Speaker (Hon David Warner): Order.

Hon Mr Rae: I would say that we are looking seriously at the amendments and obviously dealing with the precise wording of them. I would also say to the member that obviously one of the objectives that has been set out in the government's whole approach to this is that, as a result of what takes place over the three-year period, there will be a reduction in the size of government. That's, I think, very much what is in the cards in terms of the overall size of the public sector.

Some parts of the public sector will grow. One doesn't want to say that no parts of it will ever be allowed to grow, but overall there's a need for greater rationalization, there's a need for a significant adjustment in the size of the public sector. That's one of the reasons we're bringing in the legislation, because we genuinely believe that it requires either a negotiated social contract or negotiations within the context of legislation, which is where we are now, in order to deal with this very --

The Speaker: Would the Premier conclude his response, please.

Mr Harris: Premier, I think you would know that we agree with the intent of downsizing permanently the size and cost of government, as does the board of trade, which I met with today, and everybody we've talked to. The principle is really not in question, except for a few people who seem to have a vested interest other than the good of the province.

But in the covering letter today, which accompanied draft amendments, I indicated as well that we were prepared to look at another amendment for which we didn't have the legal amendment language, but I'd like to share this with you today. This amendment would reduce wages by 5% across the board on the next anniversary date of a contract and it would continue for three years.

However, we would encourage with this amendment the social contract talks to carry on for the three-year period, as they're doing with the joint management committee of the medical social contract agreement that was negotiated last year, and that any savings that can be negotiated and achieved in wage costs in the three-year control period could then be redistributed as raises back to individual employees.

This would encourage social contract partners to work cooperatively through the three-year control period to find new and creative and efficient ways that we all want of delivering services. It would allow for gains through attrition over the three-year control period. It would respect the anniversary date of contracts and it would guarantee that it would permanently --

The Speaker: Would the leader place a question, please.

Mr Harris: -- downsize the cost to taxpayers by 5% of the wage component of the broad public sector.

Would you or your caucus or in discussions today be supportive of this kind of amendment that would avoid the panic of having to have the agreements finalized before the social contract talks come in but in fact would encourage and provide incentives for the talks to continue through the three years?

Hon Mr Rae: Again, without committing ourselves to any particular wording, the principle of wanting to maintain a very major level of negotiation and discussion between and among all the partners is going to be required. This is not something that, having started in earnest in April, in fact can simply be turned off.

The requirement that people discuss with each other on an ongoing basis the impact of the fiscal realities that surround the province is, I think, essential. We tried to do it through negotiation, without legislation. Now we have legislation which provides a framework and we think a very clear incentive for people to bargain. But we're looking very closely at whatever suggestions are coming forward. If there were any suggestions coming forward from that side, obviously we'd be looking at them as well.

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Mr Harris: Respecting the anniversary date is, I believe, an important principle that has been respected by federal and provincial governments in the past when this type of legislation was needed. Secondly, having an across-the-board 5% cut kick in, then with negotiations there to take attrition and other things into account, would truly encourage employees, I believe, to find more efficient ways of permanently downsizing government.

But in conjunction with that, something else we think would be very important: When, two days from now, your budget proposal is to cut the transfer payments to our transfer partners by 5% of the wage component of all those transfer partners -- municipalities, school boards, hospitals, colleges, universities, all those receiving money -- even though the legislation will not be passed, even though the clear direction will not be there, the intent was to cut those transfer payments as of July 1. In conjunction with our most recent amendment that we're releasing today, would you not agree with me that the 5% transfer cuts to our transfer partners ought also to kick in on the anniversary date of those contracts?

Hon Mr Rae: We are obviously looking at whatever approaches are being put forward by constructive individuals, and we'll continue to do that.

I would say to the honourable member, with respect to the government's decision to signal very clearly this is the fiscal reality and we all have to adjust to it, that we in a sense allowed the negotiations initially to proceed without taking that step. When the public sector coalition walked out of the talks and tore up the social contract proposal without putting forward an alternative, we at that point decided that we have to send signals through the financial transfers that would create a more realistic climate.

The fact of the matter is that we are determined not to exceed the budgetary requirements that we have. We have made serious commitments to the taxpayers of the province with regard to what will happen in terms of the budget and we have to live up to those requirements. Therefore, we have to meet the fiscal climate that's there, have to reach whatever agreements within that climate. So we intend to proceed with the cuts in transfers on July 1.

LONG-TERM CARE

Mr Michael D. Harris (Nipissing): My second question is also to the Premier. Yesterday, Premier, you ducked a question on your government's plan to drive the private sector out of community-based services for long-term care, but it's a question for which you personally owe us, the Legislature, the people of this province, particularly those who will be receiving services and those delivering them, an answer.

We have legislation before us which is intended to cut the wage bill of government, yet your plans for long-term care will add thousands of people and millions of dollars to that same government payroll with this attitude that only government employees can provide services.

This just doesn't make any sense -- on the one hand to be talking about downsizing the cost of government, looking for new, creative, entrepreneurial, efficient ways to deliver services -- for you to be proceeding that way. It makes no sense at all. At a time when we should be looking to the private sector to help provide additional services, why would you deliberately set about with a policy to close down those services that already exist and are being delivered by the private sector?

Hon Bob Rae (Premier): The minister has, I think, indicated clearly to the House yesterday and for purposes of, if you like, making it clear from my perspective -- and I've had a long-term interest in this issue. In fact the first speech I gave in the Legislature as leader of the third party, standing in the place of the leader of the third party, had to do with what was going on in Ontario's nursing home system.

I would say to the honourable member, I think to some extent he is misconstructing the government's proposal. What we're saying is that as there is going to be a major expansion into community care and into care that will be provided in the community, the government's preference --

Mrs Elinor Caplan (Oriole): You are trying to put them out of business. You are going to cut services and raise costs.

The Speaker (Hon David Warner): Order.

Hon Mr Rae: We are the government and we are, I think, entitled to state this, just as other governments have done with respect to services: From the point of view of public policy, our preference is to see that services are provided on a non-profit basis by non-profit agencies.

The only area where I would disagree with the honourable member is, for example, when he says people have to work for the government. No, that's not the case. If you work for the Red Cross, you don't work for the government. There are a number of agencies which are capable of providing a service on a non-profit basis. Frankly, we feel that's a more efficient way to proceed, and it ensures and guarantees that the level of services will in fact -- in terms of the expansion of services, in terms of new services.

Mrs Caplan: Higher costs, less services. Every study in the ministry says it is higher cost.

Hon Mr Rae: Let me say, Mr Speaker --

The Speaker: Would the Premier conclude his response, please.

Hon Mr Rae: I'm being heckled again by the former Minister of Health. When the member for Oriole was the Minister of Health, it was her government that said the expansion in the nursing home sector would take place in the non-profit sector and not in the for- profit sector. So I would say to the honourable member, you practise one thing when you're in government, and as soon as you revert to the opposition, you decide to attack, attack, attack. It's not good enough.

Mr Harris: The Premier is quite right. He is carrying on a policy the Liberals started. We objected to it then, we objected to it when the member for Oriole brought those policies in, and we object to it now.

Almost all the affected workers, the thousands who stand to lose their jobs because of your plans, are women. The industry estimates some 10,000 jobs could be lost. The minister disputes this, but we'd be interested in knowing what studies you have as to how many jobs will be lost or how much money it will save.

If you, as the former government before you, the Liberals, think the non- profit sector is better, more efficient, why are you not prepared to let it compete with the private sector? Why not have them bid on the jobs? Why not let the non- profit sector of course exist and of course be there, but force it to compete and tender and bid to provide these services with the private sector? Why won't you do that?

Applause.

The Speaker: Order.

Hon Mr Rae: Again, I would say to the honourable member, he talks about which government did what. It was your government, the one that lasted for 42 years, that said the hospitals in the province of Ontario would operate on a non-profit basis. You're the ones who phased out private-profit hospitals. You're the ones who said private-profit hospitals will not be allowed to operate in the province and it will be operated on a non-profit basis.

Mr Jim Wilson (Simcoe West): We had a balance.

Hon Mr Rae: That was your government that did that. It wasn't a social democratic government. It wasn't a Liberal government. It was a Conservative government that did it.

Why did they do it? Because they decided it was a better way to ensure accountability and it was a better way to ensure that services were being delivered directly to people. It was on that basis that it was decided, rather than see an expansion of the commercial sector. You're the ones who understood that when you were in office. Now that you're in opposition, you'll take up --

Mr Jim Wilson: Read our policy. It was a balance. You know it was a balance. What a bogus argument.

The Speaker: Order, the member for Simcoe West.

Hon Mr Rae: Any grievance, any cause, as long as it gets you a headline and as long as it gets you applause in the Legislature. It's not good enough.

When you were in government, those are exactly the steps you took to deal with it. You didn't expand the hospitals on a for-profit basis. You didn't expand education in the 19th century on a for-profit basis, but we expanded into public education. Every time we've taken a major decision in this province to expand public services, we've done it on a non-profit basis, whether the Liberals did it or the Tories did it or the New Democrats did it.

The Speaker: Could the Premier conclude his response, please.

Hon Mr Rae: It's not a matter of ideology; it's a matter of common sense and public service. That's the basis upon which we've made our decision.

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Mr Harris: I think if the Premier will reflect on the education system, on home care, on long-term care, on nursing homes, our government encouraged, supported and allowed the private sector to go out there and compete with the public sector, and that's what we're asking you to do today.

Let's face it, your government is charging ahead with this ideologically driven plan without any idea of its impact. You continue to follow the Liberal lead in long-term care for one reason and one reason only. It's the same reason you continue the Liberal housing policies that don't help those who truly need help, yet cost the taxpayer untold extra hundreds of millions of dollars. It's the same reason you're driving the private sector out of day care. That reason is Liberal-socialist ideology at any cost.

How can you on the one hand say you're going to cut the compensation costs of the public sector through Bill 48, and on the other hand continue to increase the size and cost of government with your long-term care plans?

Hon Mr Rae: I always appreciate these tirades from the leader of the third party. I haven't been called a socialist in a long time and I finally have been.

Laughter.

Hon Mr Rae: I knew I'd get someone to laugh.

I would say in all seriousness to the member that, again, I think we have to have a sense of the history of this province. How have we expanded major public services? You make the comparison with child care. I would say to you: Right on, you're right. When we expand child care in this province, we're going to expand it not as a kind of McMuffin approach to child care; we're going to expand it on the basis of a public service. That's the basis upon which we're going to expand it. That's the basis upon which we expanded public education in the 19th century. That's the basis upon which we expanded medicare in the 20th century.

We're not going to turn the public services of this province holus-bolus over to for-profit commercial operators. We're simply not going to do that. We're going to allow a place for the private sector. We're not ruling out a place for the private sector. All we're saying is that the priority, as far as this government is concerned, for expansion will be in the not-for-profit sector, in the charitable non-profit, voluntary non-profit, non-governmental non-profit, broader public sector. That's where we're putting our emphasis, and as New Democrats we're proud to be putting our emphasis there, very proud indeed.

ONTARIO ECONOMY

Mr Gerry Phillips (Scarborough-Agincourt): My question is to the Premier and it has to do with the issue of jobs and the economy. We in the opposition, at least, continue to see an awful lot of pain out there. The unemployment rate -- and we're coming up on three years of your government -- according to your own numbers in the budget, approaches 14%. We see young people unemployed for long periods of time. I think all the members daily have calls from people who are desperate about the economy. We continue to see businesses closing. We see a continuation of pain, and frankly, a fair bit of pessimism out there. On the other hand, I think you have a different view of it. I think your view is that the recession has ended and that the Ontario economy has turned the corner.

Could you explain to all of the people of Ontario how you have reached this determination that the recession is over and that the Ontario economy has turned the corner?

Hon Bob Rae (Premier): First of all, I want to say that I guess the honourable member and I can probably agree on more than his question would permit. I don't think any one of us who has eyes and ears and who cares about this province, and that includes members on all sides of the House, not just New Democrats or Liberals or Conservatives, and people throughout the province -- we all realize, and I certainly realize, that there is a lot of pain out there.

I don't think anyone's denying that. I wouldn't deny that for a moment. I wouldn't deny that the recession, depression, whatever you want to call it, the major increase in unemployment that we've seen over the past number of years, and which is only just now beginning to recede, and not as strongly as I would like, has had a very tough effect, a very profound effect on the whole province. I'm not denying that for one instant and I'm not denying that the joblessness has got to be the major challenge facing this economy, facing this country and facing this province. Indeed, I would argue it's facing not only our economy but the American economy, the European economy, everybody, us included, very directly.

I would say to the honourable member that the signs of recovery are, I think, there simply in terms of the number of things that are happening, the number of moves that are being made --

The Speaker (Hon David Warner): Could the Premier conclude his response, please.

Hon Mr Rae: -- the increases in investment and so on, the increases in exports, the increases in industrial and manufacturing and other activity. I would say that it's not as great or as strong as I would like. I'm not denying that for a moment. But I would say that if he's suggesting that somehow this government believes there's no pain or difficulty out there and everything is just hunky-dory, then I think he's got the wrong impression of my own views. I've never suggested that. I have suggested that there are signs of recovery --

The Speaker: Could the Premier please conclude his response.

Hon Mr Rae: -- and that we have to do everything we can to sustain that recovery. We've also been very candid in saying this recovery is going to take some time to have its full impact across the province.

Mr Phillips: The reason I sometimes, frankly, get angry with the Premier -- I am quoting you, Premier. These aren't my words; they're your words. You said, "The recession has ended and the Ontario economy has turned the corner." You based your budget on that, and in less than two days we're going to see taxes go up dramatically in the province. I realize you may stand up and rail, "Well, we've got to do it," but those taxes going up were based on your determination that the economy had turned the corner.

Now I hear from you today something a little different: weak signs of recovery; things may not be recovering as well as you would like. I quote your words, "The recession has ended." Those thousands of people out there without jobs listening to you don't believe the recession has ended, don't believe Ontario has turned the corner.

Have you now determined that the economy is not recovering as quickly as you thought in the budget, and are we still putting ourselves at substantial risk by a substantial increase in personal income tax in another two days that will take a substantial amount of money out of the economy? We all recognize the need to control the deficit, but that increase in taxes was based on a strong economic recovery. Are we putting at risk more downturn in the economy as a result of your proposals on the tax increases?

Hon Mr Rae: I honestly don't believe we are. Obviously, as a government, we would not be taking steps that we thought would have that effect.

I would say to the honourable member that I appreciate his advice and listen very carefully to his questions. He tells me that the Liberal Party of course accepts the need to get the deficit under control. Let me say that not only is the Liberal Party opposed to tax increases; they're opposed to the social contract and to the deficit reduction, and judging from their questions, they're opposed to the entire expenditure reduction plan.

I say to the honourable member, and I say with great respect, because I spent a lot of time talking to the business community and they're a little bewildered by where the Liberal Party really stands: You're opposed to expenditure reduction, you're opposed to tax increases and you're opposed to the social contract. You're opposed, opposed, opposed, and you also say you're opposed to the deficit. It doesn't add up. The numbers don't jibe.

Mr James J. Bradley (St Catharines): On a point of order, Mr Speaker: I was under the impression that in this House it is inappropriate to mislead the House. Is that not correct?

The Speaker: The member is correct, yes, of course. At this point I would not accuse anyone of doing that.

Mr Bradley: Then why does the Premier continue to make statements that are factually incorrect?

The Speaker: I knew that the member for St Catharines would not suggest that someone was misleading the House.

FIRST MINISTERS' MEETING

Mr Michael D. Harris (Nipissing): My question is to the Premier. Yesterday, by indicating that you would not attend the briefing for our new Prime Minister of Canada to make sure that 40% of Canadians' views would be heard before she goes to the G-7 summit, I suggest to you that you sent a signal out, perhaps inadvertently, that partisan politics is more important than Ontario's interest and making sure that a newly elected Prime Minister who does not come from Ontario has the full benefit of the government and the Premier of the province of Ontario.

Are you prepared, as it will cost you nothing more than a few hours of your time and a flight to Vancouver, to reconsider and make sure that our new Prime Minister, regardless of political affiliation, has the benefit of understanding Ontario's very serious situation before she goes to the G-7 summit?

Hon Bob Rae (Premier): I will not rise to the bait and will simply indicate that no, I'm not prepared to attend the meeting.

Mr Harris: As it appears as though at least seven premiers, and perhaps all, do wish to make sure that the new Prime Minister fully understands their provinces' concerns, and as I personally believe that Ontario is suffering through a very difficult period of time, I think before the Prime Minister goes to the G-7 summit she should in fact get the benefit of a full briefing of Ontario's concerns. As you won't go, will you send me?

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Mr Murray J. Elston (Bruce): On a point of order, Mr Speaker: I don't think the legislative forum is any place where the member for Nipissing should expect to be paid back for his support of the government's social contract legislation.

The Speaker: The member knows he does not have a point of order. The Premier may wish to respond.

Hon Mr Rae: I must confess that the thought hadn't even occurred to me, and I appreciate the honourable member raising it. I would say to him very directly that I really do believe there are major federal-provincial issues that are going to have to be addressed that are substantive, that are deep and long-term and require a major investment of time and energy on the part of whatever government is elected in the next federal election.

NORTHERN HEALTH SERVICES

Mr Gilles Bisson (Cochrane South): My question is to the Minister of Health. Thursday of last week, I believe, the physicians in my community held a public meeting in order to bring people together to talk about some very real issues around the health care sector. Some of the things that were commented on at that particular meeting were somewhat disconcerting, to say the least, not only to some of the people who were there but generally for the public of Ontario.

One of the things that was asserted was that under the plan now in negotiation between the Ministry of Health and the Ontario Medical Association, OHIP would limit the access to health care and the number of services to people.

Interjections.

Mr Bisson: I know health care may not be important to some of the members of the opposition, but it's certainly important for the people of northern Ontario.

The Speaker (Hon David Warner): Could the member place his question, please.

Mr Bisson: I'll repeat the question, Mr Speaker. There have been allegations made on the part of the Ontario Medical Association that if a child has an ear infection, they would only be able to access the doctor's office once per year. I want the Minister of Health to be able to clarify that particular position for not only the people of Cochrane South, but for the people of this province.

Hon Ruth Grier (Minister of Health): I welcome the opportunity to clarify some of the allegations that have been made, regrettably, by the Ontario Medical Association in its advertising campaign. Let me say as categorically as I can that this government will never do anything that would limit medically necessary services in this province. I greatly regret the fact that fear is being caused in the minds of the constituents of the honourable member and of other people around this province, fear that I think has more to do with not the limitation of services but perhaps some limitations on the income of the people who deliver those services. I think it's completely unfounded.

Mr Bisson: The follow-up to that is one of the issues that was talked about there, a real issue with regard to the number of patients doctors have to deal with over a period. One of the ways the ministry is looking at dealing with that with the OMA is the question of a threshold on their incomes. I know the ministry has been working at trying to deal with the question of thresholds and recognizes the specific difference in northern Ontario: the number of patients doctors need to treat due to the very nature of having a limited number of doctors in northern Ontario. I wonder if the minister can clarify how the threshold would be applied to northern doctors in underserviced areas.

Hon Mrs Grier: As the member will know, that is part of the negotiations we are having with the Ontario Medical Association that are ongoing and that I hope will lead to some long-term and permanent resolutions of what has been a very long-standing problem: how to attract physicians to remoter parts of northern Ontario.

As the member will know, without thresholds and cash and travel incentives, there would be even fewer doctors in the remote parts of northern Ontario today than there were 10 years ago. In fact, I gather the ratio has increased so that the doctor-to-patient ratio is now, in northern Ontario, what it was in southern Ontario 10 years ago. At the same time, we are still having to fly in doctors from Israel, from South Africa, from Australia, because it is impossible to get locums to serve in northern Ontario.

I hope that in negotiations with the OMA we can come to a resolution of those issues, because I know the member's constituents, as well as all the residents of areas that are underserviced, hope that this would be the case.

CORRECTIONAL FACILITY

Mrs Yvonne O'Neill (Ottawa-Rideau): My question is for the Minister of Community and Social Services. You know and I know that crime among youth, especially young offenders, has risen severely, in some areas by as much as 50%. You know and I know that there's a desperate need for a secure-custody facility for young offenders in eastern Ontario.

A committed group of citizens in Ottawa-Carleton, including professionals, has been meeting over the last number of years. They have met every criterion of your ministry. In fact, they received complete approval for their project in 1991, a full two years ago.

To this date, no funds have flowed for the construction of this project. Why do you continue to refuse to meet with the board of directors of the William E. Hay Centre, and why do you continue to resist giving them any real reasons for your refusal to flow these long-awaited, much-needed funds?

Hon Tony Silipo (Minister of Community and Social Services): I have to say to the member that I'm not familiar with the particulars. I would be happy to look into it and report back, if need be. I wasn't aware that there had been a request for a meeting that had been turned down, and I'd be happy to look into that as well.

Mrs O'Neill: That answer's appalling. I've got copies of each of the letters that have been sent to the minister, and some of them are as old as three months. The most recent one is six weeks ago. He doesn't get his mail? I get mine. Then I'll have to tell you a little bit about this project.

There are young offenders waiting in Ottawa-Carleton. On a weekly basis, they're being transferred out of our community for stays as short as 15 days to facilities in Uxbridge and in Pickering, hundreds of miles from their families and from the professionals who care for them.

I remind you that we're talking about 12- to 15-yearolds being shunted around this province from eastern Ontario because this government -- and you yourself have just suggested that you don't get your mail, or you haven't got the political will to find out what's going on in eastern Ontario.

Your own ministry has determined that eastern Ontario is underserviced in secure custody and detention for young offenders. I ask you again, will you assure this House of your commitment to provincial funding for the youth of eastern Ontario in a project that has received all approvals; services that are needed and are crucial to the futures of our youth in eastern Ontario?

Hon Mr Silipo: I appreciate the importance of the issue and I do find it unfortunate that the member has chosen to categorize my first answer as being somehow uncaring about the issue. She would know that when she has brought issues to my attention, they certainly have been followed up.

I'm quite conscious of the fact that there is a problem with respect to the general issue of how we provide for facilities. This is not a problem that afflicts only eastern Ontario; there have been other instances in other parts of the province where we've managed to deal with the issue. I will be happy to look into the issue and hopefully be able to look at what resolution may be possible.

PHOTO RADAR

Mr David Turnbull (York Mills): My question is to the Minister of Transportation. Since your government's decision to introduce photo radar, you have failed to offer any empirical evidence of the reduction of accidents in those administrations which already have these devices.

In a recent article in the Toronto Star, which I'm sure you've read, it suggests that the principal reason for buying these pieces of equipment is revenue generation. I wonder if you could respond to that charge, or is this simply another tax grab?

Hon Gilles Pouliot (Minister of Transportation): With respect to the member opposite, he has a tendency, when we're talking about safety measures, to confuse the issues. It's not a tax grab. Everyone knows that speed kills. It's a safety initiative. We're hoping to break even in terms of revenue; no more than that.

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Simply put, and by way of conclusion to the preliminary question, photo radar is an enforcement mechanism for those who exceed the speed limit. It's no more than that and it's no less than that.

Mr Turnbull: I have to say the minister has failed to dispel the concerns that are felt on this side of the House. I would ask you then, would you commit today to dedicating the net proceeds, after the cost of the equipment, to the police force that is operating this and commit that it will not disappear into general revenue, so that those moneys can be used by the local police force for safety enforcement?

Hon Mr Pouliot: The member goes from the obsessive to the pathological. This issue is a matter for the Treasurer to decide, whether the pool of money, if any, will go to the general fund. I hear the member loud and clear and I indeed sympathize with the proposal that it should be dedicated or that part of it be dedicated. I will simply pass the comments or suggestion along to the Minister of Finance.

COMMUNITY ECONOMIC DEVELOPMENT

Mr Tony Martin (Sault Ste Marie): My question is for the Minister of Northern Development and Mines. This government, as you know, has started out on a very aggressive agenda to put Ontario back to work. As part of that agenda, the Minister of Economic Development and Trade recently announced a new initiative to actually put Ontario back to work, which I am hoping will have some significant application for northern Ontario. I'm speaking of the community economic development or Jobs Ontario Community Action fund.

Your ministry has been named as leading this program in northern Ontario. Could you explain to me how you see this helping the north in these difficult times and how it is different from some of the important and helpful things we are doing now?

Hon Shelley Martel (Minister of Northern Development and Mines): I appreciate the question from the member.

First of all, how I think this initiative will help the north is in two ways. The member will know, and so will other members from northern Ontario, that there are some very dramatic changes occurring in the pulp and paper and mining sectors in northern Ontario. Many communities are trying to look at economic development in the broadest sense of the word, including tourism, culture, education, social services, health etc. The initiative is focused on promoting that look at economic development in the broadest sense and providing capital dollars to fund those kinds of projects, so it fits very well with the work that is starting to happen in northern communities now.

Secondly, there are a number of changes in legislation that I think are going to be very helpful to northern communities. First of all, we know that many entrepreneurs have good ideas but can't get money from the banks, and sometimes even government programs aren't flexible enough to allow them to fund those ideas, so legislation will be passed in this House that will allow loan corporations to be set up, to allow municipalities or communities of interest to loan money to small businesses to get those ideas off the ground.

The Speaker (Hon David Warner): Could the minister conclude her response, please.

Hon Miss Martel: A number of communities we know would have liked to have entered into joint ventures with businesses but were not permitted to do so under the Municipal Act. We're going to be changing that act to allow them to do that.

So I think it is different, because we now have capital money that will allow for projects in the broader sense of economic development and the legislative tools to allow communities to enter into ventures with other partners in the community.

Mr Martin: I'd also like to ask the minister, in light of a meeting I had last Friday in my own community in an attempt to try to explain these new and important initiatives, just how it will specifically apply to a place like, say, Sault Ste Marie.

Hon Miss Martel: Part of the aim of the program is to allow many more people to participate in economic development in our communities. Traditionally, economic development has been moved forward by municipal council, and in some cases there has not been a broad representation by many people in the community who have an interest in the community and how it moves forward. We are encouraging projects to come forward not only from municipalities but many other non-profit groups, aboriginal groups, minority groups etc who have an interest in moving their community forward.

The other aim was to coordinate some of the activities of government ministries for the first time. There are a number of ministries in northern and southern Ontario that provide funding for community economic development, but traditionally they have not worked very well together to coordinate those activities on behalf of the communities. In northern Ontario we have a regional team in northeastern and northwestern Ontario, one located in Timmins, the other located in Thunder Bay, and we will accept all of those projects from those groups. I would encourage people in Sault Ste Marie who have an interest and who have a proposal to submit those to the Timmins office.

ACQUIRED IMMUNE DEFICIENCY SYNDROME

Mr Tim Murphy (St George-St David): I have a question to the Minister of Health. I have a draft of a confidential Ministry of Health policy proposal from the AIDS working group within your own ministry. As you know, this has been in existence for up to a year. A friend of mine was working on this, and unfortunately because of the delay in acting on this policy proposal he has died in the interim from AIDS. There's been a delay on this. The previous minister will know that that person locked himself to your door because of that delay.

As part of this policy proposal, there's a suggestion with respect to catastrophic illness funding for AIDS and HIV drugs, there's a recommendation related to that. Is the minister planning on proceeding with that, and if so, when?

Hon Ruth Grier (Minister of Health): First of all, let me respond to what I think is the unfortunate preamble to the member's question, because this province, under my predecessor the member for Beaches-Woodbine, has taken leadership across this country in not only the establishment of an AIDS bureau and an AIDS advisory committee but in fact putting in place education and prevention to try and deal with this disease, as well as programs in place to help those suffering from the disease.

The question of catastrophic drugs and payment for those drugs, as I'm sure the member well knows, is one that has been under discussion and one that is difficult and extremely expensive.

I'm glad to be able to tell the member that I have today released a discussion paper with respect to reform of the entire Ontario drug benefit program, which speaks to the difficult questions and decisions that have to be made, such as, if we are to expand eligibility for drugs for people such as those in need and who suffer from AIDS, how do we do that and at the same time contain the costs and make the program more equitable? I anticipate there will be some very serious public policy debate about that over the next two or three months.

Mr Murphy: I think it's unfortunate that we didn't get a ministerial statement with respect to that plan in the House. However, there are groups in my riding, like AIDS Action Now and others, that are concerned about this issue. Given that there's going to be some more time frame before there's actually action on this, I'm wondering if the minister is prepared to look at some other concerns that the community has. For example, what is happening in some areas now is finance companies are purchasing the life insurance policies of people with HIV and AIDS at a discounted value in order to give them the money to pay for drugs now. I'm wondering if the Minister of Health would undertake to look into that issue to make sure that people living with HIV and AIDS aren't ripped off.

Hon Mrs Grier: I find it very distressing if that in fact is happening, and I would be happy to look into that and to talk to whichever of my colleagues in fact might be able to do something about that particular issue. But I would urge the member to engage in discussion with the community that he represents around Ontario drug benefit reform. I would say to him that they are proposals; they are not policy positions at this point, which was why there was no statement in the House with respect to that. I anticipate that we will be able to move forward on reform by the end of this year.

The Speaker (Hon David Warner): The time for oral questions has expired.

Mrs Elinor Caplan (Oriole): On a point of order, Mr Speaker: to correct the record. I know how important it is for members of this House not to mislead the public who are watching with information --

The Speaker: The member may correct her record. Go ahead.

Mrs Caplan: It was the policy of the Liberal government of which I was a member to support and foster a healthy, competitive environment between the public and private sector in the delivery of services. The Premier today --

Interjections.

The Speaker: Order. If the member for Oriole wishes to rise and correct her record, could she please indicate on what day the error occurred and what it is she wishes to correct.

Mrs Caplan: I'm rising today to correct the Premier's statement, which was inadvertently false.

The Speaker: The member can take her seat. The member knows full well that she can rise to correct her own record, not anyone else's.

Mrs Caplan: I know that the Premier would not want to mislead the House, so it's important that he knows the facts.

The Speaker: Petitions, the member for Bruce.

Mr Murray J. Elston (Bruce): My friend the member for Oriole was just trying to help me with my petition. I agree with her that she was correcting an inadvertent error that was left on the record by the Premier.

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PETITIONS

CLOSURE OF AGRICULTURAL COLLEGE

Mr Murray J. Elston (Bruce): "To the Legislative Assembly of Ontario:

"Whereas the Ontario Ministry of Agriculture and Food has decided to close Centralia College of Agricultural Technology and the veterinary services diagnostic laboratory at the college as of May 1, 1994,

"We, the undersigned, petition the Legislative Assembly to accept the list of signatures on the attached documents and to reverse the decision to close CCAT and the veterinary services diagnostic lab located on Centralia's campus."

This is signed by three people from the riding of Bruce: Norie Campbell, Janet Chisholm and Shelley MacKay. They have attached to their petition a list of literally hundreds who form part of a single petition with over 4,880 names on it.

I endorse this petition and attach my signature.

HEALTH CARE

Mr Bill Murdoch (Grey): I have a petition to the Legislative Assembly of Ontario:

"Whereas proposals made under the government's expenditure control plan, the social contract initiatives regarding health care in the province of Ontario, will have a devastating impact on access to and the delivery of health care; and

"Whereas these proposals will result in a severe reduction in the provision of quality health care services across the province,

"We, the undersigned, petition the Legislative Assembly of Ontario as follows:

"The government of Ontario move immediately to withdraw these proposed measures and reaffirm its commitment to rational reform of Ontario's health care system through its obligations under the 1991 Ontario Medical Association/government framework and economic agreement."

INTERNATIONAL TRADE

Mr Drummond White (Durham Centre): I have a petition here from many hardworking members of my constituency, people like Stella Arthur, Suzanne Schembri, Bing Wong and Jim Reid, who petition our assembly:

"Whereas we feel the Canada-US free trade deal has done immeasurable damage to the economy of the province of Ontario, causing a loss of more than 45,000 jobs in Ontario alone; and

"Whereas we feel the proposed North American free trade arrangement will have an even more devastating effect on Ontario, resulting in a loss of not only more jobs but also in a reduction in our environmental standards, our labour standards, workers' rights, social rights and our overall quality of life;

"We petition the Legislature of Ontario to fight this trade deal with whatever means possible, and petition the House of Commons in Ottawa to stop this deal now."

I affix my name thereto.

BICYCLING SAFETY

Mr John C. Cleary (Cornwall): I have a petition to the Parliament of Ontario.

"Whereas the Parliament of Ontario would make it mandatory for every cyclist to wear a helmet when riding on a public road; and

"Whereas the imposition of this proposed helmet law would create a nightmare from an enforcement standpoint,

"We, the undersigned, your petitioners, call upon the Parliament of Ontario to reject this proposed helmet bylaw."

That's signed by over 200 residents of eastern Ontario.

NATIVE HUNTING AND FISHING

Mr Allan K. McLean (Simcoe East): I have a petition to the Legislative Assembly of Ontario.

"Whereas in 1923, seven Ontario bands signed the Williams Treaty, which guaranteed that native peoples would fish and hunt according to provincial and federal conservation laws, like everyone else; and

"Whereas the bands were paid the 1993 equivalent of $20 million; and

"Whereas that treaty was upheld by Ontario's highest court last year; and

"Whereas Bob Rae is not enforcing existing laws which prohibit native peoples from hunting and fishing out of season; and

"Whereas this will put at risk an already pressured part of Ontario's natural environment,

"We, the undersigned, adamantly demand that the government honour the principles of fish and wildlife conservation, to respect our native and non-native ancestors and to respect the Williams Treaty."

That's signed by 214 signatures from Norwich, Delhi, Ingersoll, North Bay, Powassan, Sturgeon Falls, Brockville, Fort Frances, Devlin, Tillsonburg and Kitchener, and I've signed by name to it.

SCHOOL FACILITIES

Mr Gordon Mills (Durham East): I have a petition signed by 1,069 people in my riding of Durham East, and they say as follows:

"We petition the Legislative Assembly of Ontario:

"Whereas the facility utilized by St Stephen's Secondary School in Bowmanville is leased, and we request a capital grant to build a new permanent facility there."

I have affixed my signature to this petition.

SENIORS' HEALTH SERVICES

Mrs Joan M. Fawcett (Northumberland): I have a petition from approximately 30 seniors from Bewdley, and it is to the Legislative Assembly of Ontario:

"We, the undersigned members of the Bewdley Senior Citizens' Club, would like to add our voices in opposition to reductions in health care services through the reform of the Ontario drug benefit program. We feel that the present government pensions for our seniors are not adequate to cover any changes, such as user fees, that would increase the financial burden of seniors of this province."

I have signed the petition.

ABORTION

Mrs Margaret Marland (Mississauga South): I have a petition which reads as follows:

"We, the undersigned, protest your government's endorsement of the recommendations of the task group of abortion service providers and the Minister of Health's intention to implement them."

There are hundreds of names on this petition, and I'm happy to write my signature to support it.

GAMBLING

Mrs Ellen MacKinnon (Lambton): I have a petition sent to me from the Watford-Warwick pastoral charge by the Reverend Aylmer Smith to the Legislative Assembly of Ontario. There are about six whereases here that everybody has heard before. I won't bore them with any more:

"Therefore, we, the undersigned, petition the Legislative Assembly of Ontario as follows:

"That the government of Ontario cease all moves to establish gambling casinos."

Mr Charles Beer (York North): I have a petition to the Legislative Assembly of Ontario:

"Whereas the Christian is called to love of neighbour, which includes a concern for the general wellbeing of society; and

"Whereas there is a direct link between the higher availability of legalized gambling and the incidence of addictive gambling; and

"Whereas the damage of addiction to gambling in individuals is compounded by the damage done to families, both emotionally and economically; and

"Whereas the gambling market is already saturated with various kinds of government-operated lotteries; and

"Whereas large-scale gambling activity invariably attracts criminal activity; and

"Whereas the citizens of Detroit have since 1976 on three occasions voted down the introduction of casinos into that city, each time with a larger majority than the time before,

"Therefore, we, the undersigned, petition the Legislative Assembly of Ontario as follows:

"That the government of Ontario cease all moves to establish gambling casinos."

This is signed by several hundred persons from my riding, and I have affixed my signature thereto.

Mrs Elizabeth Witmer (Waterloo North): I have a petition here from Waterloo North Presbyterian Church, as well as All Saints Anglican Church, with whom they share their facilities. It comes from the minister, John Young. It says:

"To the Legislative Assembly of Ontario:

"Whereas the New Democratic Party government has not consulted the citizens of the province regarding the expansion of gambling; and

"Whereas families are made more emotionally and economically vulnerable by the operation of various gaming and gambling ventures; and

"Whereas credible academic studies have shown that state-operated gambling is nothing more than a regressive tax on the poor; and

"Whereas the New Democratic Party has in the past vociferously opposed the raising of moneys for the state through gambling; and

"Whereas the government has not attempted to address the very serious concerns that have been raised by groups and individuals regarding the potential growth in crime,

"Therefore, we, the undersigned, petition the Legislative Assembly of Ontario as follows:

"That the government immediately cease all moves to establish gambling casinos and refrain from introducing video lottery terminals in the province of Ontario."

I support my constituents in Waterloo, and I hereto sign my signature.

Mr Paul Wessenger (Simcoe Centre): I have a petition to the Legislative Assembly of Ontario from St George's Anglican Church in Barrie.

"Whereas the government has not consulted the citizens of the province regarding the expansion of gambling; and

"Whereas families are made more emotionally and economically vulnerable by the operation of various gaming and gambling ventures; and

"Whereas credible academic studies have shown that state-operated gambling is nothing more than a regressive tax on the poor; and

"Whereas the government has in the past vociferously opposed the raising of moneys for the state through gambling; and

"Whereas the government has not attempted to address the very serious concerns that have been raised by groups and individuals regarding the potential growth in crime,

"Therefore, we, the undersigned, petition the Legislative Assembly of Ontario as follows:

"That the government immediately cease all moves to establish gambling casinos and refrain from introducing video lottery terminals in the province of Ontario."

RETAIL STORE HOURS

Mr Ron Eddy (Brant-Haldimand): A petition to the members of the provincial Parliament, re Bill 38, an amendment of the Retail Business Holidays Act to permit wide-open Sunday shopping and eliminate Sunday as a legal holiday:

"We, the undersigned, hereby request you to vote against the passing of Bill 38. We believe that this bill defies God's laws, violates the principles of religious freedom, reduces the quality of life, removes all legal protection to workers regarding when they must work, and will reduce, rather than improve the prosperity of our province. The observance of Sunday as a non-working day was not invented by man but dates from God's creation and is an absolute necessity for the wellbeing of all people, both physically and spiritually. We beg you to defeat the passing of Bill 38."

It's signed by myself and 71 residents of the Norfolk area of the province.

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BEER AND WINE TAX

Mrs Margaret Marland (Mississauga South): I have a petition which reads as follows:

"Mr Rae, get out of my pocket. I mow my own lawn, paint my own house and make my own beer. I don't want your proposed tax on brewing my own beer, which is my right. I support small businesses in my community and they in turn provide jobs. Stop patronizing big business lobbies at my expense. Mr Rae, stop the imposition of the tax on brew-your-own outlets."

This petition is signed by over 100 signatures, and I am happy to lend my support to it.

HEALTH CARE

Mr Pat Hayes (Essex-Kent): I have a petition here signed by approximately 1,800 people in my riding. It's to the Legislative Assembly of Ontario. It says:

"We, the undersigned, request that Ridgetown and the surrounding district be recognized as an area of the province which has a shortage of family physicians. Specifically, we require exemption from the following aspects of the Ministry of Health expenditure control plan:

"The plan to withdraw older physicians from practice. This could result in a loss of three of the four doctors in our community who service over 10,000 people.

"The plan to reduce fees for new physicians by 75% for the first five years of practice. This will force the two doctors who are planning to start practising in our community in 1994 to leave the province.

"The plan to reduce payments to general practitioners who provide services above a certain threshold. This restriction would discourage the only physician who would be left in our community if the above aspects of the expenditure control plan are imposed on our community."

BRUCE GENERATING STATION

Mr Murray J. Elston (Bruce): A petition to the Legislative Assembly:

"We, the undersigned, petition the Legislative Assembly as follows:

"When discussing the future of Bruce A, to consider that the undersigned are in full support of the continued operation of all of the units at Bruce A. Furthermore, we support the expenditure of the required money to rehabilitate the Bruce A units for the following reasons:

"In comparison to other forms of generation, nuclear energy is environmentally safe and cost-effective. Rehabilitating Bruce A units is expected to achieve $2 billion in savings to the corporation over the station's lifetime. This power is needed for the province's future prosperity.

"A partial or complete closure of Bruce A will have severe negative impacts on the affected workers and will seriously undermine the economy of the surrounding communities and the province."

I have attached my signature along with some 15,600 others. I can advise that we thought that this matter was progressing relatively well until we discovered that the New Democratic Party is now asking Ontario Hydro to find another $100 million in its restructuring program, which I expect will negatively affect the Bruce A units. I continue this series of petitions.

HEALTH CARE

Mr Jim Wilson (Simcoe West): I have a petition addressed to the Legislative Assembly of Ontario:

"Whereas proposals made under the government's expenditure control plan and social contract initiatives regarding health care in the province of Ontario will have a devastating impact on access to and the delivery of health care; and

"Whereas these proposals will result in a severe reduction of the provision of quality health care services across the province;

"We, the undersigned, petition the Legislative Assembly of Ontario as follows:

BRUCE GENERATING STATION

Mr Murray J. Elston (Bruce): I have another petition to the Legislative Assembly of Ontario.

"Whereas there is a concern in Bruce county and neighbouring communities that the Rae government will refuse to do rehabilitation and general maintenance work required to keep Bruce A functioning efficiently; and

"Whereas a detailed technical report prepared by informed and objective people has already shown that the maintenance and rehabilitation work is not only cost-effective but profit-generating; and

"Whereas there is concern in Bruce county and neighbouring areas that Bob Rae will circumvent that study by using non-objective people to restudy the cost-effectiveness of the rehabilitation and maintenance expenditures,

"Therefore, the undersigned request that the Legislature accept the list of signatures on the attached document addressed to Bob Rae and require the Premier to respond directly to them indicating that he will guarantee a fair assessment of Bruce A maintenance and rehabilitation plans."

This is signed by a citizen of Toronto, and I attach my signature in support. As I've said, these petitions are more necessary than ever since the NDP government is now forcing Ontario Hydro to find another $100 million under the social contract when the workers and the employer have already been working very diligently to do some restructuring, to cut costs and meet a target which all want to achieve in terms of ratepayers' costs of Hydro.

INTRODUCTION OF BILLS

ELECTION STATUTE LAW AMENDMENT ACT, 1993 / LOI DE 1993 MODIFIANT DES LOIS EN CE QUI CONCERNE LES ÉLECTIONS

On motion by Mr Sorbara, the following bill was given first reading:

Bill 57, An Act to amend the Election Act and the Legislative Assembly Act / Loi modifiant la Loi électorale et la Loi sur l'Assemblée législative.

The Deputy Speaker (Mr Gilles E. Morin): Do you have any brief comments, Mr Sorbara?

Mr Gregory S. Sorbara (York Centre): Yes, just very briefly. When this act passes, it will put to an end the century-old practice of allowing the Premier of the province to determine the timing of a by-election. When it passes, it will provide that 70 days after the death or resignation of a member, a by-election is to be held in the riding of that member.

CITY OF MISSISSAUGA ACT, 1993

On motion by Mr Mahoney, the following bill was given first reading:

Bill Pr46, An Act respecting the City of Mississauga.

ORDERS OF THE DAY

ONTARIO LOAN ACT, 1993 / LOI DE 1993 SUR LES EMPRUNTS DE L'ONTARIO

Mr Sutherland, on behalf of Mr Laughren, moved second reading of the following bill:

Bill 25, An Act to authorize borrowing on the credit of the Consolidated Revenue Fund / Loi autorisant des emprunts garantis par le Trésor.

Mr Kimble Sutherland (Oxford): The 1993 Ontario Loan Act will provide the government with authority to borrow up to $16 billion over the 18-month period ending December 31, 1994. The amount of the Ontario Loan Act is calculated as the sum of the financing requirements for this fiscal year plus the financing requirements for the first nine months of the next fiscal year.

It is traditional to request authority to meet the borrowing needs for part of the following fiscal year to allow adequate time for the passage of subsequent loan acts, thus ensuring an orderly borrowing program. This year's borrowing program will include bonds, treasury bills, US commercial paper and medium-term notes.

The Deputy Speaker (Mr Gilles E. Morin): Are there any questions and comments?

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Mr W. Donald Cousens (Markham): How much did the province borrow last year, inasmuch as you're coming forward with this bill to give the province the right to borrow $16 billion? How much did the government borrow last year and the year before? Just give us the years since Mr Rae and the NDP came to power.

It's so easy these days for people to come in with bills that are going to give the government the right to borrow, and $16 billion is more money than the honourable member and I will make in our lifetimes, so I'd be interested in knowing just how much.

Maybe, as well, if you could answer the question, how much interest we will end up paying on that $16 billion before it's totally paid off. That is again a second question that every one of us should be thinking of. If you have a mortgage for $100,000 over a 20-year period, you're going to end up paying well over $200,000. So I'd be interested in knowing just how many billions of interest we will be paying on the money that you're bringing before this House.

We have to become all the more accountable, every one of us, on this kind of data, and as one who would like to speak on it further when we have an opportunity, the answer to those two questions would really please me: How much did we seek to borrow last year and the year before and how much interest is it we're going to be paying on this amount of money?

Mr Murray J. Elston (Bruce): I recall, as we do regularly, having to do the Ontario Loan Act and go through various machinations trying to get information from the government with respect to its plans for the money. Each time that I've been here with the New Democratic Party, leading the charge on the budget, it has failed to meet its targets at almost every level.

I think I would, if I were able to move an amendment to this act, like to require the government to put out a line-by-line explanation of where each of the dollars that is being authorized to be borrowed under this act would be applied, and in fact, if it deviated one iota from that expenditure plan, that it would have to come back to this Parliament to get the approval of the people to the deviation from the expenditure plan.

I understand that for the government to accept an amendment from the opposition, on a budget bill in particular, would be tantamount to admitting a lack of confidence and in fact that would not very well fit in with our traditional way of doing business. I think the people of the province expect that we will have to borrow money just because of the nature of our business here, but it seems more and more my constituents would like some say or at least some review of all the dollars that are being borrowed and would like to put on what would be described in government circles as executive control, if I can describe it as that. But the executive control would reside on that borrowed money with the people, the taxpayers.

I understand that there is a budgetary plan and all that sort of stuff, but when you come in with the loan act, it would be so wonderful if you would say: "This $100 million is to go to social services, this $100 million to capital projects and we're going to stick to that. If there's a deviation, we can come back." Would you entertain that as a plan, Mr Parliamentary Assistant?

Mr Chris Stockwell (Etobicoke West): The parliamentary assistant to the junior minister of Health, I suppose, is the one introducing this $16-billion borrowing loan.

Hon Brian A. Charlton (Government House Leader): Finance.

Mr Stockwell: Finance, I'm sorry.

Yes, it's a significant amount of money. The insufficient information is truly mind-boggling when you talk about $16 billion and it can be parcelled off on a two-page report.

The things that you should be supplying the public out there -- some interesting facts that I think the public would like to know. For instance, you're acquiring $16 billion in new dollars. How much debt are you retiring? That's a scary figure, I think. I think you should respond with that kind of number, because it seems to me the $16 billion we're acquiring and what we're retiring are completely different figures. We're talking about retiring -- I'm not sure how much -- $1 billion maybe, somewhere in that. Maybe you can check it out. We're retiring $1 billion in debt and acquiring $16 billion. That's got to raise some red flags around town.

When you look at the direct debt by current fiscal year-end, it's projected to be $78.6 billion. Look at it this way, he just pops up to spend $16 billion in new dollars. Think of it. Over the past decade Ontario's debt levels have increased by 161.7%. Imagine that, a 161.7% increase in debt in the last decade.

The per capita has increased by 126.3%. Now we just pop up and they're going to borrow another $16 billion. It's frightening, the kind of money they're talking about here. All the while, the 161% increase in debt -- per capita, personal income has gone up by 53.3%. So we have borrowed at three times the rate people's per capita incomes have gone up.

The real question I'd like to get out to the public out there is: You're borrowing $16 billion new dollars. How much old debt are you retiring so you can acquire the $16 billion? That, my friend, is a frightening statistic.

Mr Anthony Perruzza (Downsview): I've listened to the three rebuttals now and all three of them had this grand opportunity to suggest an alternative. It's worth noting on the record that they failed to seize the moment and suggest that alternative.

The Deputy Speaker: The member for Oxford, you have two minutes.

Mr Sutherland: In response to the question from the member for Markham, during the 1992-93 year, $15 billion was borrowed. In response to the question from the member for Bruce, he wanted line by line, and the member for Bruce is well acquainted with the estimates process and the estimates give line-by-line awareness of where the money is planned on being spent.

Mr Cousens: On a point of order, Mr Speaker: I suggest that we give extended time so the honourable parliamentary assistant can answer all the questions that have been asked.

The Deputy Speaker: That's not a point of order.

Mr Stockwell: On a point of order, Mr Speaker: I only ask unanimous consent -- he forgot to answer my question -- to allow him to answer.

The Deputy Speaker: Unanimous consent? No. Further debate.

Mr Gerry Phillips (Scarborough-Agincourt): I'm pleased to begin the debate on what's called --

Mr Cousens: I'm surprised you're pleased.

Mr Phillips: I'm perhaps not pleased to be debating the issue, but I'm pleased to be debating some of the concerns that we have.

For all members, Bill 25 is the bill that authorizes the government to borrow $16 billion, obviously an enormous amount of money. I wanted to spend some time on the bill because I think Canadians are becoming growingly aware of the problems of debt. I think, increasingly, by the way, that we as a country now are looking at our debt in total. One of the mistakes we've made in the past is that because we're a federal system -- we've got a federal government that has debt and a provincial government that has debt -- we haven't added the two together very carefully.

The international community, of course, now does that and is acutely aware of the debts of the provinces, and as a matter of fact, in many respects is focusing as much or more on provincial debt as it used to on federal debt. By not managing this issue, we're costing ourselves an awful lot of money.

Just as one small example of that, in addition to all the money we spend on the interest on the debt, the province of Ontario has recently lost its AAA credit rating. For many out there that may not seem all that important, but when you lose your AAA credit rating, for each time you lose, if you will, a mark on the rating, it costs about $2.5 million a year in extra interest costs on every $1 billion you borrow.

For all of us who are trying to find ways to economize, having lost our AAA rating, and we now are down to what's called essentially an AA rating -- we could have been AA-plus, AA or AA-minus; we're about in the middle of AA -- that is costing us, for each $1 billion we borrow, around $3 million a year in extra interest costs. You can see that the government plans to borrow $16 billion here. With that one act alone, lost our AAA credit rating, the taxpayers of Ontario are going to be asked to pay almost $50 million a year in extra interest costs just because we lost our AAA rating.

I many people in the province are now aware that this government, the Bob Rae government, is, I think, on the edge of losing the AA rating. That would be extremely significant because if we move from AA to A rating, not only do our interest costs go up, not only do people charge us more interest to loan us money, but we cut ourselves off from a whole range of sources of funds. There are many pension funds and many funds out there that simply will not loan money to an organization that has less than a AA rating.

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While we'll get into many other areas on this bill, the government is teetering on the edge with our bond rating agencies. There are four major bond rating agencies. They all have Ontario under a microscope. That's why, in our opinion, Premier Rae had a major change of heart, almost, in March.

I remember, for example, that the Finance minister came to our finance and economics committee meeting in late February and said: "We've been working for months" -- at least two months -- "on this presentation. Here are all the numbers for the finance and economics committee." This was in something we call pre-budget hearings. "Here's what we think the deficit will be." It was around $13.5 billion or $14 billion. "Everything seems to be on track for what we thought was going to happen. We have to make some additional reductions in our expenditures."

That was in late February. Then a month later the Premier announced a completely different set of numbers. I think he went to the caucus and said: "The sky is falling. It's now going to be a $17-billion deficit." Those who were on the finance and economics committee will remember it was only four weeks earlier that the Finance minister came and told us he'd done all the number tumbling and the deficit was going to be somewhere around $14 billion.

The point I'm making is that nothing happened between the time the Finance minister came to our finance and economics committee and the time Premier Rae had the big announcement at the end of March, other than, I suspect, the rating agencies said to the government, "You're in trouble." We've been telling the government it's in trouble. The third party's been telling it it's in trouble. I think the rating agencies said, "You're in trouble." They didn't tell you what to do. They simply said, "Unless you do these things, you will lose your AA rating."

At least for someone outside looking at it, we began this exercise the Premier has been on now for the last four to five months of, I think, quite a disorganized process of trying to manage the province's finances. I happen to think the $17-billion number came out of thin air. It couldn't go up by $3 billion in four weeks. The Premier engages sometimes in being Premier and sometimes in being in collective bargaining. I think he got into the collective bargaining mode and said: "There's going to be a $17-billion deficit. The sky is going to fall. The caucus better get in line, and then all the rest of the province had better get in line."

I believe that came as a result of the rating agencies telling the government that unless it got its financial house in order, we would be down from a AA rating to an A rating. That would be serious for a variety of reasons. Increasingly, as I think most members of the House know, we borrow money outside Canada. I believe the two largest borrowings, bond issues, in the world, outside of sovereign borrowings, outside of countries borrowing, last year were done by Bob Rae's government. There was no other larger borrowing -- two of them -- than by Premier Rae.

Incidentally, the two lead groups that did them were both New York-based firms. Perhaps that had to be. I was, frankly, disappointed that they weren't led by Ontario-based firms for this reason: I happen to think that we have, to use the term, a world-class financial community in Ontario. That is one of our competitive edges. I'm a big believer, and I think most of us understand that if we're going to compete in the years ahead, we have to have "world-class" industries located here in Ontario that can compete with anyone around the world.

What did the government do? The two largest bond issues in the world last year were both done for the Ontario taxpayers, but the government chose two non-Ontario companies to lead those issues. They were very good companies; there's no doubt about that. They, by all accounts, did a very good job. I was somewhat disappointed to see that we weren't able to allow a couple of our Ontario-based firms to do that.

In any event, the bill that we're dealing with here is giving authorization to borrow another $16 billion. As I said earlier, we are on the edge of the bond rating agencies taking our rating down, and if it goes down a little bit more, we have some significant problems.

Managing the debt: As I say, I think we now, all of us in Canada, are beginning to internalize and are beginning to understand why it's important, and are increasingly realizing that the debt isn't an abstract thing, that the debt isn't something that somebody else is going to pay, that the debt is something that we're going to pay.

Just so all of us understand, one way I look at debt is that there are, say, about five million people who work in the province of Ontario, and I don't mean that they have the only responsibility for the debt, but they tend to carry a larger share. If you were to divide the debt among those five million people, those five million people owe the federal government $35,000 each in debt and they now owe the provincial government $15,000 in provincial debt. That's $50,000, and that's not abstract because, whether people out there have fully understood this or not, they have to pay about $5,000 a year just to pay the interest on that.

We can see at the federal level, at the national level, what that's done. What we now find is that for every dollar of taxes we pay, 34 cents of it goes just to pay the interest on the federal debt. We have an enormous problem on our hands because we essentially are getting no services for that, but we're spending 34 cents of every tax dollar.

It used to be, only four years ago in Ontario, that less than 10 cents of every dollar was spent paying the interest on our debt. It now, as I recall in the latest budget by the government, has gone to 16 cents. In 1990-91, 8.8 cents of every dollar we paid in taxes went to pay the interest on the debt. It has literally doubled in the last four years, to 16 cents.

By all accounts, we can see now that the Bob Rae government has doubled the debt in three years. When he came into power, the debt in this province, after 122 or 123 years, was at about $40 billion. We now see that at the end of this year, the debt in the province will have gone to $78 billion, if I'm not mistaken. That's right: $78.6 billion, virtually doubled after three NDP budgets, and the amount of money we now have to spend just to pay the interest on it has gone, as I said before, from about nine cents of every dollar we raise to 16 cents, and we're teetering on it getting out of control. That's why the bond-rating agencies have increasingly focused on Canada and, taking into account aggregating, adding the two together, indicated that, "Unless Ontario gets its financial house in order, you're going to lose the rating."

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So the bill we're debating today, while it's only really one page, is important, because it allows the people of Ontario to understand and focus on the debt/deficit problem that the Bob Rae government has gotten us into.

How did we get here? How did we arrive at this problem? I think people out there are astute enough and smart enough to understand that you can't blame one individual or one government or one circumstance for all of the problems we're in. There is no one reason.

For all of us who understand and watch global events, we see other countries. Europe's struggling right now in many respects, Japan's gone through a bit of a tough patch, and I'm sorry to see that the gross domestic product in the US looks like it's slowed down a little bit in the past few weeks, which incidentally is a problem for us, because as we all know, the Ontario economy depends heavily on a successful US economy and if that slows down we're in trouble; 85% of our exports go to the US. I think everyone right now believes that the reason the Ontario economy is ticking along and showing some modest growth is because of exports. All of our home consumption is very weak.

In any event, how did we get where we are now? World events have contributed to it; there's no doubt about that. The free trade agreement: It's always interesting here in the Legislature, for those people who watch it, that if someone asks Premier Rae why the economy isn't going any better, it's, "The free trade agreement's really devastated us."

I think it is fair to say that if there were a way to implement the free trade agreement poorly, Canada found the way to do that. Whether you agree or disagree with the free trade agreement, I don't think there's any doubt that it has been badly implemented, and to whatever extent we could have taken real economic advantage of it, we handcuffed our manufacturing sector during its introduction.

If you remember, I believe when the free trade agreement was just being introduced the Canadian dollar was at 76 or 77 cents and then went up to 88 cents. That's like taking the price of goods up for our manufacturing sector by 12% or 13%. Just when they're trying to move into the US and compete, the Canadian dollar goes up that much and we handcuff ourselves. That also was the time when interest rates went up very substantially, and went up substantially vis-à-vis the US, and we put another handcuff on our manufacturing sector, plus we'd been through a period of some political instability.

So regardless of one's view on the free trade agreement, I think there is general agreement that the way it was implemented was bad.

I also happen to think that something we haven't as a Legislature really looked at thoroughly enough, and I think it will become increasingly clearer, is that the underground economy, if I can use that term, the non-traditional economy, is far larger now than it was a few years ago and may grow even more. Examples of that we've all got, but the smuggling that goes on in the tobacco and liquor business is substantial.

When I talk about the Rae government doubling the debt and getting us into a very serious fiscal problem, I wanted to point out the other things that really it had relatively little to do with. At the same time, I think it's important to point some things out.

When Bob Rae took over as Premier, Ontario had just had its first balanced budget in 20 years. That's not widely known. It's something the Conservatives don't like us to remind people of; they get angry when we tell people that the Conservatives, for the last 15 years they were in, never balanced the budget and always ran substantial deficits. I know they'd like to portray Premier Davis and the Treasurer then, Mr McKeough, as the great financial managers. The fact is that for the final 15 years of Conservative government here in Ontario, ending in 1985, there were 15 straight years of deficits.

Because one can get into partisan interpretations of this. I think the people of Ontario really need to simply look at the Provincial Auditor's report. The Provincial Auditor, for anyone who doesn't know, is an independent body that looks at the province's finances and gives the people of Ontario an independent view on the finances of the province. They examine the books and ensure that the government of the day is properly keeping the books and properly reporting them. It's a very worthwhile function.

The Provincial Auditor did two things, among others, in his 1991 report. This was the report that was prepared after the Rae government came in and reported on what we call the 1990-91 fiscal year. What the Provincial Auditor said was, "Ontario has had only one surplus in the last 20 years." That was the year ended March 31, 1990. If you remember, as I well remember, the Liberal government was defeated in September 1990, so a surplus, documented by the Provincial Auditor, as of March 31, 1990.

I notice the Minister of Natural Resources looking incredulous. I'm not sure that their caucus or their cabinet perhaps is aware of all these things: One surplus in 20 years, the year ended March 31, 1990. Then the Rae government came in, about five months later, at the beginning of September. As I say, there was a surplus when the Rae government came in.

I have to acknowledge that the budget that was prepared and presented in April 1990 by Bob Nixon, Treasurer Nixon, called for another surplus. That 1990-91 budget said there would be a second consecutive surplus. That's the one that ended up with the $3-billion deficit. I know the Premier loves to trot that one out: "You were going to have a surplus and you ended up with a deficit. You misled the people." That's the implication of it.

I want to say a few things about that, because it's important to make sure the record is clear. Again, the Provincial Auditor looked at that. How could it be that we had a surplus one year, that Treasurer Nixon predicted a surplus, and then at the end of the year, it ended up in a $3-billion deficit? Hadn't the Liberals misled the public? Here's what the Provincial Auditor said about how it went from a surplus to a $3-billion deficit.

He said, "The major factors contributing to this variance were" -- he's talking about the fact that a surplus was predicted, then the deficit ended up being $3 billion -- "the extent of the recession, which was obviously not foreseen at the time of the budget," and I think it's understandable that it wasn't foreseen. "Total revenues were down by approximately $1.1 billion due primarily to the influence of the recession on taxation revenues." That's about 2% of the revenue. The Provincial Auditor said that when the budget was prepared, the extent of the recession was not foreseen, so it's not unusual to see a revenue drop of that magnitude.

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Secondly, "Expenditures were up by approximately $1 billion, with the increase in social assistance payments the major contributing factor." Again, I think a fairminded person would say, "When you get into that sort of recession for that length of time, it's not unusual that social assistance costs go up," and they did.

The third reason for the $3-billion deficit was that the Bob Rae government chose to make three special payments totalling $924 million. One was to the Ontario teachers' pension fund. That payment was not due until the following year, but the government chose to move $196 million of teacher pension spending up one year, advance the payment. They paid off a $400-million loan to the Urban Transportation Development Corp that was not due, and they wrote off SkyDome, $321 million.

These are good political moves, because it's a good way to say: "We inherited a mess from the Liberals. They said there'd be a surplus, but it's a $3-billion deficit. Woe is me." As I say, it's natural politics.

As a matter of fact, I kept the reports from then Treasurer Laughren, now Minister of Finance, who said publicly, after he'd been in the job for several weeks, that nobody attempted to mislead. He said, "Nixon was simply giving the best estimates of the treasury staff at the time." I point that out, because when we get into a debate about how we got into this, I'm sometimes slightly amused, I guess.

Bob Rae will say, "You left an awful mess for me," but I don't know how you can justify saying "an awful mess," when a balanced budget was certified and presented. The Provincial Auditor acknowledged it, said it was a surplus. All of your own numbers showed a surplus five months before you took over office. How can the sky suddenly fall?

The NDP says, "You people were spendthrifts" and all that sort of thing. Well, here's what Bob Rae's New Democratic Party said when we were preparing that budget. This was when they were still in opposition, when they were demanding more spending and saying, "Spend more, spend more." What was Bob Rae saying in the spring of 1990, before the election? Now he says that we were the spend party, but then he was saying of the then Liberal government:

"The Ontario government has reacted to predictions of an economic slowdown by dropping its liberal pretence, and it's showing its true conservative nature. The Liberal government is now spreading the message that 1990 will be a year of fiscal financial restraint. The Liberal majority on the finance committee agrees with this conservative philosophy and has recommended a course of restraint.

"The New Democratic Party challenges this defence of the status quo by calling on the government to implement the reform policies needed to bring fairness to our society."

So when members of the NDP government say, "Well, no one warned us that things might be getting bad," and that the Liberals wanted to keep spending, I don't believe it, because the Bob Rae NDP caucus said: "The Liberals are predicting an economic slowdown. The Liberals are saying we need a program of restraint. The Liberals are telling us that we've got to watch our spending. But they're wrong." That's what Bob Rae said before the election. Now in the House you'll often hear him say, "The Liberals wanted to spend and we want to save." Not the case.

Again, Bob Rae says, "I was left with an awful mess." The unemployment rate in the province of Ontario was the lowest of any province in the country by far when Bob Rae took over. It was around 6%. Now, as we know from the budget, the unemployment rate -- and again I point out the chart in the budget that disturbs me the most, where Bob Rae says, "If these discouraged workers were counted as unemployed, Ontario's current unemployment rate would be about 14%." So we've gone from the lowest unemployment rate in the country to where we have an almost unheard of 14% unemployment rate in real terms.

We now find Manitoba has a substantially lower rate of unemployment than we do, as does Saskatchewan, Alberta, British Columbia. There's even been a period within the last year or so when New Brunswick had a lower unemployment rate than Ontario, and I'm very happy for New Brunswick on that, very happy, but for Ontario I'm very sad.

So the reason I go through this is to try and put it into some perspective when Premier Rae says, "Woe is me," and, "I was left with a terrible problem." Well, he was left with the lowest unemployment rate in the country. We now find four provinces with substantially better unemployment rates. So you can't say it's all just a global problem.

We had just had the first surplus in 20 years in the province. That's not to say that there aren't challenges, major challenges presented by a slowdown in the economy, but there was the first surplus in 20 years, the only surplus in 20 years. Premier Rae is often fond of saying, "Well, no one warned me." Well, lots of people warned him; he just wasn't listening.

So what was the biggest problem, what single thing led us to this situation, our fiscal situation? I said earlier that you cannot blame Bob Rae for everything, but I would say there is no doubt that the first NDP budget was a huge mistake. None of the NDP members can ever admit that publicly. I recall the words in it: "We could fight the deficit or we could fight the recession. We're going to fight the recession." A big mistake, huge mistake, and you're paying for it now. The fact is that you should have fought both things. There was not -- well, the member might laugh, but you're going to have to learn to do more than one thing at once.

Mr Stephen Owens (Scarborough Centre): How? Gerry, how?

Mr Phillips: You say, "How?" It's very simple. If you understood where this is going to lead, you don't take your spending up 14%, you don't offer settlements that are three and four times the rate of inflation.

Hon Frances Lankin (Minister of Economic Development and Trade): That isn't true.

Mr Phillips: Well, it is true.

Mr Owens: Blame the victim.

Mr Phillips: The members are choosing to heckle, but the thought of continuing to defend that budget is disturbing. I think the most you could do is just hang your head and try and forget you made that big mistake, and it was a big mistake. Now, I tell you, everybody is paying for it because you're clawing it back. You opened the tap and you left it running for two years. I guarantee you any objective analysis of that budget would show it was a huge mistake. I wouldn't defend it. The best you can say is, "I'm sorry, we didn't know at the time it was a mistake." But now the members are wanting to defend the budget; it's indefensible. It was a mistake, huge mistake.

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Actually, I can remember, and Hansard will show this, because we, the finance and economics committee, spent that summer, the summer of 1991, touring the province, getting feedback on the budget -- I learned several things at that session. One is, I can recall the Premier's office phoning groups to get out and defend the budget. I thought it was an indefensible budget. I can remember saying to various groups: "Well, suppose the government's wrong. Suppose this is going to slow the economy down, and suppose that rather than spending one's way out of the recession, that's not the right approach, and we should have had some restraint in it. What will you say then?"

I think the critics of that budget -- and, by the way, they were the third party, ourselves; I don't think there was another jurisdiction in North America that thought Bob Rae was right on this. The word "restraint" never appeared in that budget; never appeared in it. It was a huge mistake. I don't think there's any doubt about that. Once you run two years of $11-billion and $12-billion deficits, once you get that built in, boy, it's tough to get it out, as you're finding now, as we're finding now. As I say, it's all got to be extracted, and that's far more difficult than giving.

If there is one thing that I will hold the government accountable for, it will be that one, because the price we'll pay for it has been and will be enormous, not the least of which is -- I'd like to talk about where we are now and how we go on from here, but the exercise we're involved in now on what's called the social contract is chaotic. It is totally chaotic.

I have a feeling for what the caucus is going through because it is fundamental change being made up, unfortunately, on the back of an envelope because of the time. The time pressures have simply run ahead of the government's ability to stay apace with it. I fault Premier Rae on that. When you're going to work your way out of these problems, you need a plan and you need to bring people along. I think we're in the middle of a totally chaotic process and, God -- gosh; pardon my language, Mr Speaker -- I hope that we can work our way through it because we're on the edge of being seen as fiscal incompetents by the world financial community, and we're now in that ball game of the world financial community, whether we like it or not. As soon as you decide that you're going to have to borrow those amounts of money, as soon as you decide you're going to float those issues, as they say, globally, and as soon as you hire the high-profile houses, as they say, to do it, you're on the international scene, and they are scratching their heads.

Frankly, for all of us, it puts a lot of responsibility on us. I have major problems with the social contract. I think it's a strange piece of work. The thing I worry about is what implications it will have on, as I say, the global financial community.

So how did we get here? That's the point I was trying to make. I will repeat: No one can blame Bob Rae for all of the problems of this province. It has no credibility, that sort of statement. I do believe that he has made some fundamental mistakes. I think the biggest fundamental mistake was that first budget they presented where: "We have a choice. We could fight the deficit; we could fight the recession. We're only going to fight one thing." As I said earlier, you've got to be able to do more than one thing at once around here, and now we're all paying for that.

That wasn't the only thing. I think that Bill 40 -- and I would speculate that may be, for the government, one of the proudest accomplishments. It used to be Premier Rae said OTAB was his proudest accomplishment. I happen to think OTAB's going to be a big problem. I've made my view known on that, our views known on that. I don't think you'll be bragging about that in two or three years.

But what's called Bill 40 -- and I realize we use the jargon around here. Perhaps no one else understands what Bill 40 is. It's major amendments to the Ontario Labour Relations Act. It's the rules that govern collective bargaining between employee and employers. That one became, I think, a symbol for the NDP government, I guess, but I think it cost significantly in the job-creating area.

The mismanagement of the finances: It's bad enough to present the budget, but then I happen to have a view that last year's budget -- which, if you remember, was the second NDP budget. It came, it was announced, with a $9.9-billion deficit. I said the day that came out, "It will not be $9.9 billion; it will be $12 billion." I said, "I don't know; I think Premier Rae instructed that the deficit had to be under $10 billion." But there were many things in that budget that did not have a hope of coming true.

I'll give you one example, by the way, because we've raised this issue on pensions before, and I would at least ask the NDP back bench to watch this one, because an integral part of the social contract is, as I read it, a three-year holiday from making payments into the teachers' pension portion to make up part of the unfunded liability.

In last year's budget the government had what they called "Rescheduling of Cash Payments." What it was, was that the government owed the teachers' pension and the public service pension $564 million that was due January 1, 1992. But the government rescheduled the cash payment to April 1, 1992 -- I'm sorry, 1993; excuse me, rescheduled it from January 1, 1993, to April 1, 1993. Now, that was an expense that was due last fiscal year but the stroke of a pen moved it into this fiscal year, delayed paying, and the reason was to report a deficit below $10 billion.

The thing that I objected most strenuously to was that the taxpayers had to pay 11.25% interest on that, way above what they could borrow on the market. It cost the taxpayers of Ontario $50,000 a day for that one single move, and that's well documented. There is no question about that. We, all of you out there, paid $50,000 a day in interest penalties, in higher interest rates on that pension just so Bob Rae could report a deficit below $10 billion. I thought it was obscene; I really did.

I do not fault the teachers' pension. I think it was a business deal for them. They said, "Well, you owe us all of that money" -- it was $500 million that was owed to the teachers' pension on January 1 -- "we'll agree to delay it for three months, but you have to pay us 11.25% interest on it," because that was part of the contractual deal.

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I don't blame the teachers. They were acting in the best interests of what's called the fiduciary responsibility of the people they work for to manage their pension fund. But the government and the people of Ontario paid $50,000 a day for nothing other than that cosmetic delay, and that's when you really can get angry -- that's when the public can really get angry. The opposition can get angry too, but I think the public gets extremely angry when they see not only games played with the numbers but enormous penalties paid as a result of that.

The reason I raise that is because if you start playing games once with pensions, I get suspicious. I will be watching carefully in the social contract negotiations. What's going to happen there is $500 million a year for three years, each year, is going to be delayed and not paid, and I'm afraid that, rather than it being simply a legitimate real saving, what we've done is we've simply put off to a future government a liability that was due now. The reason I raise that is that in addition to the budget numbers, there were what I perceived to be games played.

There was another one where the government said, "We are going to get $1.2 billion in fiscal stabilization money." Well, no one I know believed that. It never happens. This was an arrangement between the federal government and the provincial governments, and it never happens that you get paid on the schedule the government put in there. If you can prove it, you get paid over a long period of time, and we said that the day it was announced. We said, "Listen, you'll be lucky to get a fraction of that $1.2 billion."

The reason I'm going through all of this is that the public is astute, and it cost the government an awful lot in credibility when they played those games a year ago with the budget.

I guess another thing that's compounded the problems is, I happen to believe that our biggest challenge in the province, above all else -- and I don't mean to diminish and undermine the fiscal situation -- will be, how are we going to create an environment where enough jobs are created that we have for the people of Ontario a sense of purpose and a sense of optimism and a sense of future?

As I say, the most disturbing number in the budget was the 14% unemployment rate. That chart shows that the unemployment rate never gets below 12%, and that is a situation that we've never faced before in this province, where for a long period of time we're going to have a whole group of people who want to work, who are trained, who have skills and nowhere to go.

I know that Premier Rae has always said, "Jobs are our number one priority," and then somehow or other something else becomes the number one priority. The constitutional issue was clearly his number one priority for a period of time, and I understand that. As a matter of fact, I think he's fairly talented in that area. It's an area that he rather likes.

He really enjoys the national news and really enjoys talking to the national reporters and hurrying in and out of these major meetings with premiers. I must say maybe he's changed a little bit, because he seems to be not anxious to go to one now, but he always was off to the ones in the past, and that took a lot of his energy and time, and understandably.

Now his time is being spent on this fiscal situation -- in fact the energies of the province. I dare say the government is traumatized by it right now. I don't see anything else going on over there than the fiscal situation and the sleepless nights that must be going on and all the chaos that's going on.

So how did we get here? As I said before, one can't blame Premier Rae for everything, but I don't think there's much doubt that there have been some very major mistakes made by this government, the major one being the series of budgets that were brought in that have literally doubled the debt, have got us in a position now where this year much of our increased revenue is going just to pay the increased interest on the debt. So that first budget, the second budget and the third budget are major mistakes.

We now are coming up to three years of an NDP government. Something else I always carry around with me -- having said that, I hope I can find it now. We're almost at three years from the last election. David Peterson was a good friend of mine. I went to high school with Premier Peterson. I had a lot of respect for him. I felt, feel and continue feeling he was a first-rate individual.

The thing in the last election that caught my attention was here in the Legislature when Premier Rae launched his campaign, "'The Premier has lied to the people,' Rae charges." This was Bob Rae talking about David Peterson. Actually, I've never forgiven Premier Rae for that. I suppose you can call me bitter for that, I don't know.

"Lying" is a strong word, and I will say that Premier Rae went down in my eyes that day when he did that. It might have been good politics, but it was a signal to me that maybe he wasn't all he was cut out to be. But he said: "Premier Peterson has lied directly to the people with respect to car insurance. So I don't see that I have any alternative to say that in the last election Mr Peterson lied to people of the province about car insurance, about taxes and about free trade."

Then we see the government changing virtually everything that it ran on, virtually everything. So I have lost a good deal of respect for the ability of the government to command the respect of the people.

Where do we go from here? The government is looking for our agreement to borrow $16 billion, and we have a substantial problem on our hands here. The budget that has been presented doesn't, in my opinion, hold out hope or optimism. It is a budget that I think is devoid of any optimism. I read this thing a fair bit and it doesn't offer any sense of hope and optimism.

As a matter of fact, not only does it not offer optimism; it assumes that the unemployment rate is going to stay, in 1996, at 12%. I say it assumes that. The government knows its plans, the government knows all the things it's going to do to try and correct these things, but even taking all of those things into account, the unemployment rate still remains at 12%.

There are still some major questions that we have about the numbers in the budget. I'll give you a few examples. In this budget, there's something called moving capital to loan-based financing. There it is on page 83. I think many people in the public think, "Boy, that sounds good." It says somewhere in here that they're going to move from a grant-based to a loan-based method of financing.

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Let me tell you what that is. The province historically has provided to schools, to hospitals, to universities, to colleges about $600 million a year in capital grants. That's generally regarded as the amount of money that the province should be spending on assisting to build the capital on all those things: every year, $600 million a year.

Now the government says it's going to keep spending the $600 million, but it's going to do it quite differently. They're going to make the school boards, which are being hit quite hard, the hospitals, the colleges, the universities go out and borrow that money for the government. I'm not sure whether all the NDP backbenchers are aware of this. Then they say, "But don't you worry, you go borrow the money for us, and we'll agree to repay it over 20 years."

What we're doing here is we are moving an enormous amount of money, spending, off the government books and on to school boards, colleges, universities and hospitals. But there's only one person who has the obligation to repay that and that's the provincial government. So it's a cute trick. What it means is, the government can say, "We're still spending $600 million a year on the capital," but some future government's going to have to repay that over 20 years.

The reason I raise that is because this bill calls for borrowing $16 billion. I have a feeling that part of that money may go into the Ontario financing corporation and may end up being the money that the school boards have to borrow on behalf of the province. So that's one little concern we have in the budget.

The second concern is that there's something called savings from deferred savings. The government talks about what a great expenditure control program it has. You should be aware that of the $2.4-billion expenditure control program, $540 million is simply savings from deferred savings. They are simply postponing expenses to next year, and that's not me saying that, that's the government document that says $540 million are savings simply by delaying the expenditure.

Mr Charles Harnick (Willowdale): On a point of order, Mr Speaker.

The Deputy Speaker: You are not in your chair.

Mr Harnick: There is not a quorum present, I believe.

The Deputy Speaker: Please check if there is a quorum.

Clerk Assistant and Clerk of Committees (Ms Deborah Deller): A quorum is not present, Speaker.

The Deputy Speaker ordered the bells rung.

The Deputy Speaker: A quorum is now present. The member for Scarborough-Agincourt.

Mr Phillips: Thank you, Mr Speaker. I was talking about some of our concerns about the way the government once again is reporting its finances, and pointing out that the public is able to deal with tough news. The public understands these things, but if you hide the numbers from them, it takes them a lot longer to understand the magnitude of the problem. So I wanted to point out, expenditure savings, $540 million, are simply delaying expenditures that should have been made this year to next year. They're going to have to make them, but they're just delaying them, the new way that school capital is going to be raised.

I'll tell you the implications of this, Mr Speaker. We are going to pile up new debt every year of about $600 million, not on the government books, but they'll be spread on all school boards around the province. It will show up as a loan payable, but they'll say: "Well, don't worry about it because we've got the signature of the provincial government. They're going to pay this thing off." All we've done is hide $600 million a year in spending.

Remember, I mentioned earlier in this discussion that last year the government, with the teachers' pensions and the public service pensions, did that little rescheduling of cash payments, where it moved $500 million of teachers' pension money that should have been paid January 1, moved it one fiscal year. The plan is to do that once again. They're going to delay it once again and put that $500 million into next fiscal year.

Mr Harnick: On a point of order, Mr Speaker: We still don't have a quorum.

The Deputy Speaker: Would you please verify if there is a quorum.

Clerk Assistant and Clerk of Committees: A quorum is not present, Speaker.

The Deputy Speaker ordered the bells rung.

The Deputy Speaker: A quorum is now present.

Mr Phillips: The reason I'm raising this is because somebody is going to have to pay these bills and the government is choosing to hide many of these things. The pension one I wanted to mention again, because particularly with the discussions going on on social contracts, we're going to be watching very carefully what's happening with the pension funds.

There also is a plan to set up a reality capital corporation. This is going to be very interesting. We're looking forward to the discussion at committee on this bill, because here's what's happening: The government already has sold $600 million worth of land to itself. The government has, with the stroke of a pen, taken $600 million worth of Ontario publicly owned land, moved it over to something called the Ontario Realty Corp, which is a crown agency of the government, and then shown $600 million worth of revenue on the government side.

It's a paper transaction designed to show revenues going up by simply selling some assets to ourselves, $600 million worth of land transferred over to the Ontario Realty Corp.

What's going to start to happen now is that the government will also sell its government buildings to itself. You're going to see government-owned buildings, fully paid off -- they're all paid off -- where our public service is working, that we're going to sell to ourselves so we'll show a bunch of revenue coming in. Then we're going to lease them back.

In the private sector, if a company tried to show it as revenue and said, "Listen, our revenue isn't as bad as we thought because we've sold ourselves a bunch of buildings," I don't think an accountant would sign the books.

There's nothing wrong legally with what they're doing, I'm not suggesting that, but here's exactly what happens: We show all this revenue coming in because we sold the government building. Isn't that wonderful? But then we lease it back. It would be the same as saying to ourselves: "I'm in trouble financially, I can't afford the groceries, but I've got my house all paid off. I think I will completely remortgage my house so I can pay for my groceries and then take on a brand new mortgage payment every month." We are simply delaying dealing with these tough financial issues.

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There are plans to set up two other capital corporations, one on roads and one on sewers and water, and we see some merit in them. Obviously, we have some issues around them and we'll want answers to some questions, but at least they have some merit, in our minds. But this moving to "loan-based" financing on school capital is not loan-based at all. It is, "You go borrow the money for me and I'll sign the note and repay it, but I don't want anybody to find out that I owe you the money." It is a mistake to do that.

I want to talk a little bit about the revenue side of things because we're now less than 48 hours away from when everybody in the province will see their personal income tax go up dramatically. For those of you out there who may not be aware of this, your provincial income tax is going to go up 11% on July 1. The reason for that is this: The government is anxious to get a full year of tax revenue from you, but it wants to do it all in six months, so it has essentially doubled the hit for the last six months of the year. That's exactly what they've done. As of July 1, everybody out there, when they get their paycheque, will see, "Holy gosh, my provincial income tax has gone up 11% -- dramatically."

Here's the problem, in our opinion. We talked about this earlier today. In the budget Bob Rae said, "The recession has ended and the Ontario economy has turned the corner." That's the basis on which the budget was put together. It was on the assumption that the recession is over, that the Ontario economy has turned the corner.

I ask every business person I run into: "How are things going? Have you seen the economy turn?" I have not found one who says he's seen it turn. Maybe you have. I'd love the name. I always ask it in a way that doesn't lead the answer. I say, "Are you seeing the economy turn up?" Not one. I learned to do this a long while ago because at our finance and economics committee, we had economists come in. Two years ago, they were predicting the recession was over and things were going to be fine; that was not what I was hearing from business people out there.

Anyway, the government, Bob Rae, has said, "The recession has ended and the Ontario economy has turned the corner." I don't see that for the reasons we've talked about. The unemployment rate continues to be very troubling. As a matter of fact, in the budget -- this was interesting, if I can find it now; I will find it, I think -- the government said that 98,000 jobs have been created in Ontario in the past eight months. It was just this last Thursday that the Treasurer came before our finance and economics committee, and that report, which I can't find right now, says not 98,000 jobs, but I think 80,000 jobs have been created in the last nine months. The point I'm making is that the budget was based on the economy recovering. The recession was over. We're on our way.

In less than 48 hours we're going to give the economy another shock. So we're into a debate. We had a chance last week to talk to the Minister of Finance. I think most people appreciate that it's not a particularly easy job and that he has to make these judgements of what is the right balance. But I would say there is a very significant risk that the combination of the tax increases and the other sales tax increases in the budget will stop our economic recovery in its tracks, if there is an economic recovery going on out there, and it is very, very fragile.

The government has made its decision. There are those of us over here who would argue that it was wrong. I would just say that if it does stop the economic recovery in its tracks, for every 1% of the gross domestic product that we lose, it costs the province about $500 million in tax revenue. There's an old rule of thumb around here that says, "For every 1% of gross domestic product, revenues grow by roughly 1%." If the tax increases do have a significant negative impact on the economy, not only will it cost us jobs but it will cost us revenue.

The third thing on the current situation is the social contract, as we say, and it's quite amazing, in a period of about four months, how this jargon, if you will, has crept into our vocabulary. But we now are, I guess, five weeks away from when 9,000 collective agreements have to be reached in the province. We are seeing, I think, real chaos out there.

Others say, "Well, what would you do?" Just in case some of you may be listening, I will repeat what we said we would do 10 weeks ago. What should have happened, without any doubt, is that the government should have said to each of the partners: "We simply have to have a 5% reduction. We will allow the two parties to negotiate that agreement with themselves. Thirdly, we will sit down with our own union, OPSEU, and work out a model agreement, one that we would hope could be useful for the parties."

Now we've got a mishmash of things that won't work. We've got sectoral agreements impacting on local agreements. One of the most amazing things to me is why any government would agree to legislation that allows a minister to have the final decision on collective agreements. It isn't just till August 1; it's for the next three years that a cabinet minister will have the opportunity --

Mr Harnick: On a point of order, Mr Speaker: I don't believe we have a quorum present.

The Deputy Speaker: Would you please check if there is quorum.

Acting Table Clerk (Mr Franco Carrozza): A quorum is not present, Speaker.

The Deputy Speaker ordered the bells rung.

The Deputy Speaker: A quorum is present.

Mr Phillips: I was talking about the current situation and where we go from here. As I said before, what really should have happened, and what still should happen, is a simple one-page bill. What's happened is that I gather collective bargaining went on, got to a stage, and now the government's trying to incorporate in legislation where the negotiations got to. That's a very dangerous thing, that we're trying to put into legislation the elements that should go into a free collective agreement. And we're going to find these sectoral agreements will have very profound impact on local negotiations: There will be certain things in those sectoral agreements that make no sense whatsoever for a local agreement, but they'll end up in local agreements.

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As I say, one of the more troubling things to me is why we would ever put ourselves in a position where we give the final authority to a cabinet minister to approve or disapprove collective agreements. Surely we're starting to tread on some very dangerous ground when the final approval of a collective agreement rests on getting some political body's approval. Perhaps, as I gather it is Minister of Finance Laughren who will have that authority, people may feel comfortable, but ministers come and go. We are now setting the precedent where the provincial government is going to take it on itself to know all, to see all and to do all, and to put its stamp of approval on every single collective agreement, the 9,000 collective agreements in the province.

What I also wanted to talk a little bit about was the unemployment situation. We're just coming up on the first six months of the year, and we've seen that our manufacturing sector continues to see fewer jobs. When we look ahead at how we are going to deal with this unemployment situation, historically we'd hoped the manufacturing sector could help to deal with it, but even from 1985 to 1990, when the manufacturing sector was doing very well, growing very nicely and output going up substantially, the number of jobs in manufacturing still dropped significantly. So it will not be in manufacturing where we will see the jobs created.

It will not be -- and that's about 20% of the jobs -- construction, which continues to struggle in a very significant way. I have many of the construction trades in talking to me on a regular basis, and they've been praying that we would begin to see an upturn in the economy. But as we all know, the ICI, the industrial, commercial and institutional sector, is dead, and it would appear that for a considerable period of time we're going to see very little construction in that sector. In the housing sector I hope we'll begin to see an upturn, but significant jobs will not be created in the construction area, and that's a significant number of the jobs in Ontario.

It will not be in trade. Trade is our retail-wholesale sector.

It won't be in public administration; as we know, we're in a period where we're going to see fewer, not more, jobs in public administration.

We often think it's going to be in the service sector, and about a third of the jobs in the province are in the service sector. But we should be aware that half the service sector jobs are in education and health; in education, in all the elementary, secondary, colleges, universities and all the various training sectors, and in health, in all the health and welfare areas. Half the service sector jobs are there, and that's not going to grow very much.

Frankly, it's easier to define the problem than the solutions, obviously, and I think we increasingly understand the problem. Where will the solutions rest? Well, fundamentally we need to instil a sense of confidence in this province. My sense out there right now is that people are apprehensive about the future and have very little confidence in the Rae government, and as long as that goes on, we're not going to see investment in this province, job-creation investment.

When I look at investment, it isn't just financial investment. In fact, probably a more important investment than financial investment is intellectual investment. This is where I think you'll see that historically jobs have been created and not created. That's where individuals have an idea and get excited about it and decide they are going to try and conquer the world with it. They get out developing it and then they hire a few people and away they go. Inevitably, almost without exception, that's a tough road, because you've got a whole bunch of hurdles to get over. But we've created a climate in the province where people have lost their confidence in wanting to do that.

So it isn't just attracting the capital investment, although that's extremely important and, for the manufacturing sector, it's paramount; if they don't invest in technology, we're finished, because there's no doubt we're now into an era where we are going to have to compete globally whether we like it or not, no question of that.

But we need that sense of confidence, we need a sense of confidence by people. There is no doubt that we need a consumer-led recovery. You hear that jargon all the time, but it's true. What we've got now is an export-led attempt at a recovery. It can't do it on its own. Our exports seem to be growing very nicely, but it will not get the economy going. That's where I go back to the point I made earlier, that the tax increases coming July 1 will significantly dampen that consumer-led recovery.

The second thing we need is that there's no doubt we need to get the fiscal house in order. Someone asked aid the other day, "How long will this debate about the debt/deficit go on?" I think that debate is over. I think there is consensus in the country that it has to be tackled. Now it's a question of how it's tackled, not whether it should be tackled. That wasn't the case, by the way, even two or three years ago.

As a matter of fact, at the end of every year I send out a questionnaire to my constituents just to get their views. It's interesting just how much it's changed in two years. I realize that the people who respond may not be typical of the constituency. Essentially, a year ago the number one issue was economic conditions; 24% of the people felt that way. The number two issue was national unity, the second most important thing; 22% of the people. Then taxes, 19% of the people, and unemployment 13%.

This year, the economic issue has gone from 24% ranking and number one to 51%. National unity was 22% a year ago and it's 3% this year; someone indicated perhaps a smaller number than that. It actually went from being close to the number one issue to being close to -- I had 10 issues here -- being the 10th most important issue. The economic issues, the economy, taxes and jobs, have all gone right up the scale. It was interesting and it's informative to me, at least, to have that.

The point I'm making is this: The debate about whether we need to manage the debt/deficit is over. Now I think that issue has been joined nationally, and I might say perhaps none too soon. There are many people who look at this, but the Business Council on National Issues, a very reputable group of people and companies involved in it, put together this chart showing government debt. What they've done is to aggregate the provincial and the federal debt, which is the way we must look at it, because many of the countries -- for example, I think we've sometimes looked at the United States and said, "The US federal debt is about 10 times what our federal debt is, so vis-à-vis the US, we're about the same." But essentially, the states do not run deficits or debts -- essentially; they do have some hidden numbers. But here, as you know, we run substantial provincial debts.

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The point I'm making is that Canada now is ranked, in terms of government debt to GDP, what debt we have as a percentage of our gross domestic product -- and you can see that this is Canada way over here at 91%. We have debt equivalent to 91% of our GDP. The only countries behind us are Ireland, Italy and Belgium. Then you can see over here Sweden, Japan, Finland, Australia, Germany, France, UK, Spain, US, Greece, all well below us. The point I'm making is that the issue has now, as I say, been joined even by Bob Rae.

I mentioned the difference between federal debt and provincial debt. It is the provincial debt that has been growing most dramatically. We now see that the combined provincial debts are about $205 billion. The federal debt is about $490 billion. The total debt is $696 billion. The reason I raise all of that is just to point out that in Canada we must look at the combination of it. Increasingly, I think all of us recognize that there's only one taxpayer. There isn't a federal taxpayer and a provincial taxpayer and a municipal taxpayer. We have only one taxpayer.

So where do we go from here, getting the fiscal house in order, getting a sense of confidence in the economy and a sense of confidence in the consumer, in the public? The bill that we have before us calls for the government to borrow another $16 billion. As I said at the beginning of my remarks, we're right on the edge of some real worries in the international financial markets about the state of the province's finances, both in terms of the numbers but also in terms of the government's ability to manage them. As I said before, I think the province lost an awful lot of credibility over the last two years by both the numbers and, perhaps as important, about how the finances were managed.

This year, as I pointed out in my remarks, we again have some questions about the way the government is reporting the books. We've pointed those things out: how the school capital is being moved off government books on to someone else's books; how it looks like, once again, some of the pension payments that were due are going to be moved to next fiscal year; and how some of these capital corporations, where we say we're selling assets -- for example, we say we're selling off the GO trains; we say we're selling off government buildings. We're not really doing that. We're not really selling them off. We are simply refinancing them. We're buying them back again. We are artificially raising our revenues above what they should have been and we're taking on some new, long-term expenditures.

So the government is heading out once again to borrow substantial amounts of money, I suspect internationally. As I said before, the two largest issues of debt last year in the world, outside of countries -- countries issue debt -- were the two huge Ontario issues. I understand that they're not in foreign currency. I understand that they may have been sold in foreign currency and then swapped back into Canadian currency, which I suspect makes sense. But, increasingly, we're taking on enormous amounts of debt. As I say, our debt has doubled in just three years. When the Rae government came in, the province had just finished its first surplus in 20 years. Finally, a surplus budget. The Provincial Auditor says --

Interjections.

Mr Phillips: I'm glad there are some new members in the House, because I went over this earlier. Many of the viewers may not be aware that we have a Provincial Auditor in the province who looks objectively at the budgets and the books. So the auditor says this; this was what the auditor said in 1991, that Ontario has had only one surplus in 20 years. That was the year ending March 31, 1990, five months before Premier Rae took over; the only surplus in 20 years.

I like to raise that one because, firstly, it isn't the Liberal Party saying it; it is the independent Provincial Auditor. Secondly, we always have some fun with our Conservative friends because they love to talk about how well they can manage the finances. The fact is, they went 15 straight years never balancing the budget. The great Premier Davis never came close to balancing the budget. Even Treasurer McKeough, who was always regarded as a financial manager, never balanced the budget. It was only in the year ending March 31, 1990, that Ontario had its first surplus in 20 years.

The auditor goes on to point out there was also a surplus predicted for the next year, and that's the one where we get into some real heckling around the Legislature, because Bob Nixon presented that budget in April, predicting another surplus. So we would have had two straight surpluses, which would have been great.

But what happened, and the auditor points it out; three things happened. He said it was quite reasonable to expect that the revenues would have been what the budget predicted. But the extent of the recession was obviously unforeseen at the time of the budget. So no one could have seen that revenues were going to drop by $1 billion. That was $1 billion of the $3-billion deficit.

Mr Harnick: David Peterson knew; that's why he called the election.

Mr Phillips: One of the members is saying David Peterson knew. But I always remember Treasurer Laughren, whom I have a fair bit of -- actually, I trust him.

Mr Cousens: I am surprised you are getting into this, Gerry.

Hon Marilyn Churley (Minister of Consumer and Commercial Relations): He is tackling it head on.

Mr Phillips: Well, I just wanted to go over the situation that was left to the NDP. The second thing was that the NDP chose to write off three things that totalled about $1 billion: $200 million of teachers' pension funds that wasn't due till the following year, but they moved it up a year; they wrote off SkyDome -- I understand SkyDome -- it's all written off, it's gone, $330 million, and blame the dastardly Liberals; and the Urban Transportation Development Corp, $400 million. So I wanted to go back over that because I went over it earlier in my remarks but not all members were here, understandably very busy.

What was Premier Rae left with? The first surplus in 20 years, an unemployment rate lowest in the country, and now what are we faced with? A bill where we have to borrow $16 billion.

The Speaker (Hon David Warner): I thank the honourable member for Scarborough-Agincourt for his contribution to the debate.

Before recognizing any members for questions and/or comments, pursuant to standing order 34(a), the member for York Mills has given notice of his dissatisfaction with the answer to his question given by the Minister of Education and Training concerning savings through the social contract to be paid to Metro Toronto property tax payers. This matter will be debated today at 6 pm.

Questions and/or comments, and I recognize the honourable member for Willowdale.

Mr Harnick: I listened intently to my friend from Scarborough-Agincourt, who I might say gave a very, very interesting speech. He reviewed with considerable accuracy the financial projections and the financial calculations and the records of this province over the course of the last hour and a half. The message that he had was a message of the necessity for sound fiscal management. He pointed out that we now have an accumulated deficit in this province of some $60 billion. That accumulated deficit is up $35 billion in the last five years.

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He did, with some accuracy, indicate that my party, when in government, had run deficits. In fact I think he's accurate. I don't think it was right that we ran deficits. If there's anywhere to criticize those governments, that's fair game and so be it.

But the fact is that in 43 years, actually in 120 years, if you want to be really accurate, the accumulated deficit of this province was $30 billion. In five short years of NDP and Liberal government, the deficit accumulated is up to $60 billion, and with that kind of record, the province of Ontario now goes out to borrow $16 billion more.

I don't know of one bank that would lend an individual who was maybe $60,000 in the hole, who had no assets that were worth $60 billion, that kind of money. The only thing I can see is a government ready to have a fire sale and a government that really has nowhere to go.

Mr Sutherland: I want to respond to the member for Scarborough-Agincourt because he did want to talk about the previous government's financial record of having the first surplus in 20 years. But the member for Scarborough-Agincourt was very selective in the information he used. He forgot to remind people that during their term in government, revenues for the province raised at a minimum, I think it was, around 11% each year that the Liberal government was in power. It was pretty easy with 7% or 8% economic growth in the so-called boom times and 11% increases in revenues each year to have a so-called surplus.

Our government has had to deal with revenue declines three years in a row and, at that time, dealing with that, has tried to maintain services, do effective job creation through Jobs Ontario Capital, get people back to work and get them the skills they need through Jobs Ontario Training. We're doing all that in the most difficult economic times since the 1930s. Not even the Tories in the last recession in 1982-83 had to deal with that. Revenues still increased 8% for their government in 1982-83 during the last recession. So when they talk about how well they can manage, they haven't had to manage in these difficult times of the huge unemployment rate caused to a large degree by federal policies.

I don't know if you saw the article the other day, Mr Speaker, this memo from the Bank of Canada that said that it didn't want unemployment rates to drop because they wouldn't be at natural levels. I can't believe that type of policy is dominating our Bank of Canada and the national policy.

But I do believe the people of Ontario need to understand that it was pretty easy for the Liberals to run a surplus with 11% revenue increases. Why weren't they paying down debt and why weren't they saving money for the rainy days?

Mr Bernard Grandmaître (Ottawa East): I always enjoy listening to our Finance critic, the member for Scarborough-Agincourt, because he's so accurate in what he says.

Mr Sutherland: Selective.

Mr Grandmaître: Absolutely balanced. He has notes on just about everything the Minister of Finance and Mr Rae have said in the last three years, and he keeps reminding the NDP government of what it said when it was in the opposition and what it's doing while in government.

I'm not saying that we should forget the 1993 budget, because it's too serious to forget, but I think we should go back to 1990, the very first budget of the NDP government. Today we are paying for their miscalculation of 1990. But we have a responsibility, even in opposition, to criticize the government and also to help the government to get out of this crisis. We don't have all the solutions, but we've been offering some solutions to the government, trying to be helpful to the government.

Yet today, in second reading of Bill 25, they want to borrow $16 billion, and if they do spend that $16 billion, we'll be paying more in interest or very close to what we're investing in education. We have to put a stop to this, and I think the government should be listening to the opposition more often so that we can find a solution.

Hon Bud Wildman (Minister of Environment and Energy): You want us to spend more.

Mr Grandmaître: No. The Minister of Environment and Energy is saying, "Spend." We're saying: "Invest. Don't spend but invest in people. Get people working. They will pay for your deficit. They will pay income tax."

Mr Allan K. McLean (Simcoe East): I want to rise for a couple of minutes and comment briefly on the remarks made by the member for Scarborough-Agincourt, the Finance critic for the Liberal Party. Some of the things he had to say were spot on. I heard him talk about the call of the last election, when somebody had indicated that somebody had lied five times to the people. I read the Agenda for People and it certainly brought back some memories of what has happened. When the member talks about what has happened, he can remember the promises that were not kept.

While I was listening to the member's remarks, I had the opportunity to review a brief that I'm going to get from the Simcoe County Federation of Agriculture pretty soon. Looking at the brief, the farmers really have something positive to say about the economic and financial times:

"A farmer was overheard being asked by an urbanite how the recession was affecting him, and in his reply he said: 'What recession? It seems like things haven't changed much in nearly 10 years.' How true the statement is. Our farm products are purchasing only 15% to 40% of what they did two decades ago."

Farmers have lived with the recession that we're in. The member so statedly told us about the recession that we're in in Ontario. They talk about government financial policies. They talk about how they believe that government must implement across-the-board reduction of expenditures to all programs and people. "Governments at all levels must become more economically efficient at providing their services." Are we becoming more efficient when we're looking at borrowing the highest dollars ever in the province, $16 billion, to run this operation? Certainly, the viewers out there must have some great concerns about it.

They also go on and talk about the Fair Tax Commission. They talk about the farm tax rebate. They talk about the restructuring of the environmental bill. They talk about all the things that we talk about here in this House.

The Speaker: The member for Scarborough-Agincourt has up to two minutes for his reply.

Mr Phillips: I appreciate the comments of the members, particularly the member for Oxford in that he was indicating how they're having to manage with high unemployment, dropping revenues and a very tough situation out there. I agree with him, but I would say to him, "Did you ever think that maybe the three years of your government have perhaps contributed a little bit to that problem out there and that the reason you're facing dropping revenues, high unemployment, all of those things, may be because you are mismanaging the economy?" That's why we keep raising these issues.

Hon Mr Wildman: Government spending over the last 20 years, including the last three.

Mr Phillips: I love the Minister of Environment here yip-yapping, because they love to suck and blow, as we say.

Hon Mr Wildman: I was agreeing with you, for crying out loud.

Mr Phillips: Oh, I'm sorry.

It was the Bob Rae caucus that said, "You spent too much money." Here's what Bob Rae said just before the election:

"The Ontario government has reacted to predictions of an economic slowdown" -- that was the Liberal government -- "by dropping its liberal pretence and showing its true conservative nature. The Liberal government is now spreading the message that 1990 will be a year of financial restraint. The Liberal majority on the finance committee agrees with this conservative philosophy and has recommended a course of restraint."

Of course, the NDP didn't agree with that. Restraint? Economic downturn? Having to watch our finances? No. Bob Rae said, "Go out and spend, spend, spend." Now Bob Rae is in as Premier and he's saying, "Gosh, did I say that?" Well, I've got it all here in black and white.

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Mr Cousens: We're debating here on June 29, Bill 25, at a time when the Legislature should have risen, having completed its business last Thursday. If this House had come back when it was supposed to on March 22, rather than some three weeks later, and then proceeded with the business of the House in a businesslike fashion, we wouldn't be going on into the summer month of July, which we will be doing, dealing with unfinished business.

When you consider that this government hasn't been able to sequence the order of business in this Legislature any better than this, is it any wonder that we have problems in everything else that Mr Rae and his members of cabinet touch?

They made a commitment to this House some time ago that the Legislature would have a time schedule in which we would do business. They themselves are the ones who called the House back, instead of coming back as we were supposed to on March 22, some three weeks later. It took that long, I suppose, to write whatever it was that the Lieutenant Governor had to say in the speech from the throne.

Let it just be said that here we are in the Legislature at a time when we should have wrapped up this business and been on to other affairs.

Mr Steven W. Mahoney (Mississauga West): On a point of order, Mr Speaker: I'm sure the member speaking would appreciate it if there were a quorum present to hear his presentation.

The Speaker: Table officer, will you see if there is a quorum present?

Clerk Assistant and Clerk of Committees: A quorum is not present, Speaker.

The Speaker ordered the bells rung.

The Speaker: A quorum is now present. I recognize the honourable member for Markham.

Mr Cousens: Thank you, Mr Speaker. Inasmuch as this House is going to be continuing its work on into July, it is regrettable that we haven't been able to complete our work on schedule, and it has largely to do with the government's failure to organize its agenda a little bit better.

Now we're debating Bill 25. It only takes one page. It has less print than you have in many of the other ones we've dealt with, but it mainly calls for a total aggregate amount of $16 billion in loan money that the province will be authorized to gather before the end of this fiscal year. Authorized "borrowing under this act shall be made after the 31st day of December, 1994," so in fact they're doing it a little bit in advance, and then if they run out of money between now and then, they can come back with another bill authorizing further debt. When I asked the parliamentary assistant to the Minister of Finance, just how much interest would be paid on this, he didn't know.

It concerns me that when we start looking at the accumulated debt for the province of Ontario, we as members of this Legislature should understand just what impact that has. We're now where the debt level in 1993-94 will hit an astronomical $78.6 billion, and that's a 162% increase over the 1984-85 debt levels, a significant increase in the amount of debt.

Another word for "debt" is "deferred taxes," because what we're doing is putting off today to some time in the future when we will have to collect that money from future generations and future taxpayers in the province of Ontario. That's just another word for debt in the province: It's a future tax.

Even though this province has become accustomed to living beyond its means, at some point in time you have to come forward and pay the bill. We are now at the point where we're continuing to spend in such a way that it far exceeds the amount of money that comes as incoming to the province.

If any one of us, in running our own families or businesses, were to spend the kind of money beyond what we're earning at the rate this government does, it would bankrupt us. We couldn't begin to pay it back, and that's really what's starting to cripple the province. Just the debt interest is now becoming one of the major outlays of expenditures, instead of programs, instead of education, social services, environment or any of the other things that we want to do for job creation.

An increasing amount, 20 cents of every dollar -- it will be up to over 30 cents of every dollar -- goes just into debt interest. That's an awful lot of money, and it's that kind of spending now that takes away the opportunity to plan for things within our own lifetime.

It really points up the need that this province, this government has to find a way of living within its means during its term of office. California's done it. Other jurisdictions have done it. You are forced into living within your financial means. If you're going to have a deficit, there should be some way in which the public is going to be involved in that decision, rather than the government coming along, with total abandon to what people are talking about, and spending with total disregard to the long-term future.

In other words, there's little doubt that come 1995 the New Democrats will not be running the province of Ontario. The public have certainly had a chance to see Mr Rae and his government in action, and come the spring of 1995, probably right about now, we will be out on the hustings. Maybe by now the decision will have been made and the Bob Rae government's term of office, from September 6, 1990, will have been up and the public will have had a chance to speak on all the things that happened from that time till when the election's called.

We're dealing with so many facts as legislators. I want to pause for a moment, because this week we will celebrate Canada Day. How wonderful it is when you think that in spite of the fact that we've got all the problems in this House, we should pause, reflect and be thankful for all we have as Canadians.

As I was coming into the Legislature today, I was realizing that in spite of the problems, it's still a pretty wonderful province and it's still a wonderful country to be part of. We don't do enough waving of the flag. Let's just hope that come July 1 this year, there'll be more of us who can stand up proud and say: "I am a Canadian. We are still together. We have survived 126 years. We are going into the year 2000 with a sense of confidence that as a country we will pull together in some way. We know there is a huge challenge, but as Canadians we have an identity and a purpose, not only within our own country but within the world. If only we as Canadians could somehow pull our ranks together and be somehow united in one voice for the important things, not only in our country but across the world, it would be a wonderful thing."

I am concerned about our country. I'm concerned that when a new Prime Minister is trying to call all the first ministers together for a meeting, some would be reluctant to go. In fact, politics is constantly being played. I don't know how we do it, but as a politician I'm becoming personally very, very tired of the constant game of politics that we're always involved with.

I think the public is disenchanted with us as well. If all we can do is stand up and rant and rave and criticize and not come forward with some way of solving the bigger issues for this country, they tar us all with the same brush and accuse us of not caring for our country or our province or our constituents.

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Somehow, the parliamentary assistant system that we're into fails to give us that opportunity to participate in the big decisions of the province.

We're dealing now with a bill of $16 billion for loan money for the province. I can assure the people who are observing what goes on in this place that it's a one-party government run by the government in power and that the decisions that will be made with this money are not made by consensus of the people in this House but are made very largely by the cabinet and the inner cabinet of the government.

Mr Rae, I'm suggesting that there's got to be some way in which we start bringing out the best of all the ideas that can exist within the House. There should be a way in which together we're dealing with the problems we've got. We can have an expenditure review. There must be ways in which we can all participate.

Hon Mr Wildman: What about the finance committee? What about public accounts?

Mr Cousens: The Minister of Environment and Energy is saying the public accounts committee. That's one committee that has been working well, but there are many others that have not really had the openness of all members to be able to participate honestly and openly to present alternative points of view. What happens is that the government whip comes in and forces a vote according to government lines.

I sense a growing frustration, certainly within me and within my constituents, at our inability to come and grapple with the issues that are tearing people apart out there as we look at our society today. It is the leadership that can come from this province that can help change it, to provide jobs for youth and for people of every age who want to work, to provide services for people who need those services.

I see that there's a problem developing with the aging of the population. Every one of us is feeling that day by day as we get on. But certainly the seniors who are out there are in a position where they're requiring more and more services, at more and more cost and they're more and more worried that their pensions and the other programs might not continue.

We as a society have a deep and genuine responsibility to make sure we are providing the services for our total constituency, young, middle-aged, old and all, that they can somehow find an environment in which they can succeed and fulfil themselves. As a government, as a challenge for all of us in the Legislature, is to deal with the needs of people.

I see another thing which is the aging factor, and that's the aging factor of our infrastructure. The whole infrastructure as you see it across the province is now deteriorating at such a rate that there is great concern that we will ever have the money to rebuild the sewers and the waterways --

Mr Harnick: On a point of order, Mr Speaker: I don't believe we have a quorum present.

The Speaker: Will the table officer count to determine a quorum?

Clerk Assistant and Clerk of Committees: A quorum is not present, Speaker.

The Speaker ordered the bells rung.

The Speaker: A quorum is now present.

Mr Cousens: Mr Speaker, if we're going to be here, I suppose the message by the person who called the quorum is that people should have to suffer through my speech. That being the case, it's nice to see a quorum present.

Mr Gary Wilson (Kingston and The Islands): Are you going to start at the beginning again?

Mr Cousens: I'm not going to start at the beginning again. No, I don't think I could even do that.

The cost to rebuild and to strengthen the infrastructure, which has to do with the sewers, the roads and all the services that make up our society, is an ongoing development cost that has to be met. There is another cost, and that is just the cost to make this province more responsive to the year 2000. There have to be ways in which we can improve our efficiency and the functioning of government.

We're doing so many things the way we did in the past. We need to come along with a fresh look and say: How can we begin to rationalize different levels of government? How can we remove the duplication between governments at the federal, provincial, regional and municipal levels, remove those areas where we're overlapping and somehow become more efficient as a country?

There's a whole sense in which we have to realize that there is only one taxpayer who is paying the total levy of all the different levels of government we've got. It's important for that taxpayer to begin to get value for their dollar and that the governments responsible for it remove the duplication, remove the waste and have a sense of using the money wisely and well.

As we collect another $16 billion, living beyond our means, it's just another opportunity for us to say as politicians and as parliamentarians that we want to begin to work more efficiently and effectively together to make the best use of that dollar.

We have had, for some time, a crisis, and it's a crisis created by this government and the one before, a crisis in spending, a crisis in taxing and a crisis in borrowing. Business that has survived something of the terrible ordeal of the last few years of recession is now ready to recover and beginning to gain some confidence that there will be some certainty and some stability.

Business has been rocked over the last number of years due to all the things that have been happening in this country: rocked during the 1980s by the very high interest rates and the very uneven recovery that took place during the mid-1980s; heavy political uncertainties during the Meech accord; an overheated Ontario economy; yet another constitutional go-round in 1991-92.

At the same time, there was a major world economic restructuring going on which all began to impact on what happens here in the province of Ontario. What happened is that as Ontario, as part of the whole world economic scene, tried to survive and tried to plan for the future, we were really victims of not only government incompetence here at the provincial level, but a whole world scene that was going through massive change.

We're seeing every country trying to face up to the new challenges of the 1990s as they form their new governments, as they try to get the feel for democracy. What interesting and fantastic times we live in, when you think of what's happened in eastern Europe, when you look at what's happening now in China and its tremendous growth and potential. You feel the sense of people around the world starting to take control of their own destinies, the empowerment of business people to go out there and take part in the world economy. It's interesting that so much of the Canadian economy is being fuelled because of exports and business outside the country.

But what we're beginning to see is that we as a country have to get over some of the economic instability we've had, and we've got to make sure that whatever government does, it stabilizes those things.

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I'm concerned about the uncertainty we have going into the mid-1990s. Unemployment continues to be at an extremely high rate. We have now a situation where some 12% of the people in the province Ontario are unemployed. It's higher when you're dealing with young people and it's higher when you're dealing with people in their mid-50s and -60s who want to work. It's hard for those who aren't trained or educated. There are just tremendous pockets of communities across our province where, because the industry is dying, the lumber industry is going through change or the mine has closed, they're looking for that chance to find new work so that they can pay their way.

Canadians have that sense of desire, yet what we're sensing here now today is a growing unease over what the future can contain. As unemployment continues to grow, or at least to stay the same, we're becoming accustomed to a new playing field. It's a rough playing field for those who are in business today. They're working harder for less. Most people have suffered declines in their income over the last several years, significant cutbacks in their take-home pay, just because they are having to work harder to hold down the same old job.

At the same time as we have an uncertain time in the future, the province comes out with more taxes, again making us more uncompetitive and putting us in a position where we're not able, as a province, to be attractive to outside countries or investors who would otherwise -- and did in the past -- look at Ontario as an ideal place to invest.

We're looking at a province where deficits are out of control. That's part of what we're debating today, another $16 billion the province will borrow in order to put money in the bank to pay out for things we aren't paying for today. It's a deferred tax on the future.

What's happening is that as a province and as a country we're not coordinating all our services. We are not developing a common economic policy where, as provinces and as a federal government, we're somehow, as all Canadians, putting Canada first and saying that not only do we believe in it but we're working towards a goal.

I sincerely believe that the time as we move into July 1 is the time for us as Canadians to act together now responsibly in dealing with these problems so that we can come out of the next few years with a more capable organization, one that's responsive to the needs of the 1990s, one that has become lean and mean, the way business has, knowing that in order to be fiscally responsible and give value for money we're actually doing things better than we were in the past.

Lay out for ourselves meaningful challenges so that we, as a province and as a country, are moving towards realistic goals we can achieve that begin to balance the budget. One of the things is that we can then restructure so many parts of government where waste exists now.

Restructure our health. We have federal health, we have provincial health and we have regional health offices. Somehow bring them together and consolidate them.

The welfare system where you have all kinds of different situations evolving in different communities: Find some way that every level of government has a coordinated effort on welfare. The same for education. We have to have a coordinated economic and fiscal plan on these major areas within our country. Where there is duplication at one level, eliminate it, get rid of it and find a way of being more efficient.

We could function better, but that hasn't been a goal or an ideal or a mission that any government seems to have taken under its belt and said it wants to do something about.

Then, as a government here in Ontario, truly come up with a restraint program that allows us to get away from increasing our government spending every year.

This year, when the government came out with its $17-billion possible deficit, there wasn't anyone in the province who knew what was going on who didn't disbelieve them. In other words, we knew the government was concocting a number of a $17-billion deficit for 1993-94 when in fact it was blown out of proportion. That would have been the deficit if they'd spent every dollar on every program that they were just thinking about, rather than the programs they had already put into motion over the last couple of years.

What we really need to do is find a way in which this government and every government can reduce its participation in everything, find a way of reducing government spending and find ways of reducing the taxes. We have reached the tax wall, and the people in this province, though they don't know yet the impact of the budget, which I'll be commenting on in a moment -- but it has serious ramifications on their paycheque when it starts in July, and that retroactive tax the government has brought in, in the budget that was presented by Mr Laughren, is just another example where the government has shown little or no restraint.

What we need to do as well is look at coordinating the tax policy for every level of government in Canada. We have too many layers of government. We have enough government for 130 million people, let alone the 30 million who make up all of Canada. If we could begin to understand that we can't afford it, then we would begin to eliminate certain functions and certain services, allow another level to be responsible for it.

Let's begin to look at true reform: reform in taxation; reform in the way you collect taxes; reform so that you can motivate people who are working for the public service; reform so that the people who make up Canada have a sense that they are participating in it; reform in the political system so that democracy is something that begins to really inspire us, that we want to participate.

What a tragedy that in the two by-elections recently held in Metropolitan Toronto, in Don Mills and St George-St David, the number of people who came out and voted was under 50%. In fact, it was 42% and 44% of the people in those ridings who came out and voted. There is an apathy in this country because people largely don't feel that they can participate in the political system and in democracy, and they have a sense that it's out of their control. Well, it is, because even here in opposition there is so little we can do to cause the government to rethink its position. There is so little we can do to stop them; there's nothing we can do. The government has the power to do what it wants, as long as it wants, as long as it's in power. Talk about democracy. It isn't democracy. It's a system of government where we're elected democratically, but while that government's in power it has the option to do what it wants, when it wants, how it wants, with total disregard to the promises it made before it was elected -- and that's the case with this bunch -- and as well, to just keep spending beyond our means.

The concern that we as Canadians have to have is that there is ownership by all of us in what is going on within government at every level, and that government begins to be truly accountable to the people on an ongoing basis between elections. That is part of the demise of a strong democratic government. I don't know what the model is going to be, but we're not even looking at it. We aren't even beginning to assess the ways in which government could begin to be revitalized and activated. The whole system is sick and no one's doing anything about it.

What we need to do is begin now to have an all-party task force that begins to look at ways in which we can revitalize government processes so that the public begins to understand what we're doing and why we're doing it. We have a tremendously powerful tool through the people, to represent them and to do things better, and yet what we do is more of the same and more of the same without coming out with a fresh dream for Ontario and for Canada. What we do is --

Mr Drummond White (Durham Centre): That's it. A man with dreams and vision.

Mr Cousens: Well, what we have is the dream of the Ontario New Democratic government, and that's what we're paying for with this bill of $16 billion. When I start looking at what another billion dollars cost, it's hard to imagine what $16 billion will do, $16 billion that we don't have as a percentage of what we're talking about in what it takes to run government. It's a huge part of it. There isn't a company that could continue to spend beyond its means the way the government does, and that becomes the issue we have to face up to; face up to our responsibility as parliamentarians; go to the deep, true issues that are the fabric of what Parliament is all about, instead of just -- we come along and we'll have more bills and we'll have more issues and there'll be more things to debate and talk about.

1730

What we have not begun to do is deal with how the system is failing so many people, how there are many people who have suffered through the worst economic recession since the 1930s, how we in government are still talking and are not doing enough for them, how our system now is where 37% of those elected are in power and don't have to regard what the other 63% of the population represented by the opposition parties have to say.

Somehow the democratic system isn't working when you have the abuse of power that is going on with the present system here in Ontario. It's fundamental to what this bill is all about; it's fundamental to the tremendous dismay and frustration that I have and people I talk with have about government.

I am concerned when, as a Legislature, we're coming now to the very important decisions that will have to be made, and it has to do with how we spend our money, because how you spend your money reflects what it is that you want to do with it. It shows your priorities.

The government's three-pronged approach to the economy in 1993-94 has three parts to it. The first part is the expenditure control plan, where some $2.4 billion would be set aside and saved through cutbacks in spending. As painful as it is, our caucus has indicated support for the government in its intention to cut back on government spending.

I would like to think that in cutting back on government spending by $2.4 billion in 1993-94, the government would spend even less than last year, but that's not the case. Even though there will an expenditure control plan to reduce government spending by $2.4 billion, the government this year will still spend more than it did last year, $160 million more than it spent in fiscal 1992-93.

That is a concern. It just doesn't make sense, but the problem is that we've got to put a lid on somewhere. The government came through with a series of programs where there would be expenditure cutbacks. The specifics within that are such that I don't like all of them, but the fact is that the New Democratic government has said in a fiscal way that it will cut back spending. That's one of their programs, and our caucus is on record in support of that.

The second part is the government's decision to have a social contract. The social contract would be a new arrangement between the province and its 900,000-plus, its close to one million, employees that work for the province of Ontario. They make up close to 100,000 people that work within the direct ministries of the province and the 900,000 others who are out in the municipalities, the universities, schools and hospitals and in the crown corporations who make up the province of Ontario public service, just a huge number of people when you think of it. In the province of Ontario, at least one in 10 is working for government in some way. It's really one in four when you start looking at those actually in the workforce who are being subsidized and paid for by the taxpayers to serve them.

I have to say that as an integral part of what the government's plan is, though our party is supporting that on second reading and did, there is no doubt that our caucus is not committed to voting for the social contract on third and final reading unless a number of amendments are accepted by the government. That could mean that the government could lose Bill 48. It ties into this, Mr Speaker, because we're dealing with borrowing right now.

But our caucus is prepared to submit a number of amendments that we hope will begin to deal with the burgeoning costs of the public service. We know that the government has said it wants to save some $2 billion in salaries through the social contract. They have presented a number of ways in which they are going to do it through the existing bill, and our caucus will come in with a number of amendments that we hope will address many of the concerns that the people in teaching, in hospitals and throughout the public service are concerned with.

Those very concerns, if our amendments are met and if they're voted on and we can gain support for them, and the government can show that it's not just going to operate in a dictatorial, draconian way, as it has for this long time -- there is a chance that the government will have to look more seriously at our amendments, because who knows how many of the New Democrats are going to back out and not vote on third reading for the social contract?

That's not for me to guess or assume. I can only represent what our caucus is trying to do, and that is to come forward with responsible suggestions and amendments that can cause the government to rethink how in fact it can best meet the needs of the public service and at the same time reduce the costs of government. There are many, many ways in which this can be done.

I have no doubt that what the government has proposed with its suggestion is going to have a short-term gain, but at the end of the three years, if it lasts that long -- in fact I think there's a good chance before the next election that the New Democratic government in Ontario will cancel the social contract. At that time they would have some rationale that says, "Things are better and there's an election coming, so we therefore are going to withdraw it." That's going to be one of the amendments that we have in the bill, so that we can call upon the government to have a review of the bill on an ongoing basis each year.

Mr Harnick: Mr Speaker, I do not believe we have a quorum present.

The Speaker: I ask the table officer to determine if a quorum is present.

Clerk Assistant and Clerk of Committees: A quorum is not present.

The Speaker ordered the bells rung.

The Speaker: A quorum is now present. I recognize the honourable member for Markham.

Mr Cousens: As we review what the government's fiscal program is for 1993-94, the social contract is a very integral part to it, and I just want to highlight that our party is anxious to see something that has long-term benefit to reduce the size and scope of government.

The leader of our party, Mr Harris, the member for Nipissing, has been eloquent on this subject ever since he became leader of our party over three years ago. He has consistently said if you freeze salaries -- that's the first thing you should do. The second thing at this point is freeze hiring.

Both of those factors will have not the short-term, panic-stricken gain that the government's going to get out of the social contract that they have, but it will over the long term, because there will be a restructuring in government and the government could be downsized significantly. We're talking in the order of 55,000 people over three years, and that amounts to over $2.5 billion in long-term, continuing savings by having reduced the public service. Then, by virtue of having held salaries for all for three years, it puts a lid on that spending level.

That's painful. I realize that there are people who will get promotions and they will have an increase that goes with it, and there will be certain areas where an ambulance driver or a fire person or someone else in an essential service will be able to be replaced and brought in -- or teachers. You're going to have to make sure that some people are retiring and others are moving through. That all is part of having a tighter system.

Business has gone through it and has somehow come out of this recession leaner and meaner and stronger in order to go ahead into the future. As we look at the social contract legislation that the government has, we have very, very deep and genuine concerns. There isn't any doubt that there is no certainty, there is no guarantee that our caucus will support this bill, Bill 48, on the social contract on third and final reading. I'm just giving notice again on that.

1740

What we're talking about here in this bill is the borrowing of $16 billion. That's really quite a part of the budget that was brought in by the Treasurer. In his budget of May 19, he goes into what our debt is. Our debt has been growing and will continue to grow. For this year, it'll be $78.6 billion, the accumulated debt of the province of Ontario, and the province continues to talk about an increase in debt, that it'll be up in 1994-95 to over $85 billion, and by the year 1995-96 to $90 billion.

May I say, because the Minister of Finance has not yet hit a number correctly on any of his projections, that it's highly likely that by the time this government comes up for re-election in the spring of 1995, the total accumulated debt for the province could well be over $100 billion. At that point, just think of the interest rate that we're paying and the costs to service such a debt. Not only does the debt increase; so does our inability to pay it down and pay it off.

We have a problem in this province in that we continue to deal with half-truths. I had the pleasure last week of attending the standing committee on finance and economic affairs. It was a chance for our economics committee to listen to the Treasurer make a presentation. As affable a man as he is, he has a way of presenting his data that would make you think things are just fine. The headlines he gives: "Recovery is Under Way," "Inflation Edges Down," "Financial Markets Support Recovery," "US Recovery Continuing."

Then he goes on to say, "Impact of the Budget on Economic Recovery." This is the lie that we live with in the province. He said, "The budget is aimed at achieving a reasonable balance among competing priorities. It has kept vital public services intact. It has maintained spending on job training and infrastructure.... At the same time, it has ensured that the deficit is on a reliable downward course."

All I really want to point out by repeating some of the words of the Minister of Finance is that when he says we're on to a strong economic renewal and recovery, he is living without all the facts as the business people are talking about them. I didn't want to use words like "lie" or things like that in the Legislature, because that just would aggravate the seals.

When he comes along and says, "The budget will stimulate investment in the province," I can't believe it. How can you, for a moment, say that this budget of the province, which increases taxes, not only on individuals but on corporations, is going to stimulate investment in the province? That is not true. He says, "It increases confidence in the economy's future." It doesn't. He says, "It creates confidence that no more major tax increases will be needed in future years." Isn't that sweet news? If you don't call tolls on highways another form on tax. There's just no doubt that the government, through regulation and other means, will continue to put its hands in the pockets of Ontario taxpayers right into the future.

But he's saying he is stimulating investment in the province. He says, "The tax increase package was focused so that it will have a minimal negative impact on the dynamic sectors of the economy." The dynamic sector of the economy is those who are out there running their own business, those people who are trying to make a go of it. They're investing their own money. They're generating a few jobs. They're running a farm, they're running any kind of business, and yet every one of them is going to be taxed more this year, taxed not only on services that they have from the government; taxed on their insurance and their social benefits and taxed as well in their provincial income tax.

I have to say that when the Treasurer comes along and starts bragging about his budget and the fiscal policy of this government stimulating investment in the province of Ontario, he's got it wrong and he hasn't begun to understand that there's just so many other factors to it.

We're facing the problem as well of our credit rating. Who knows what it's going to become? Will we slip as low as Saskatchewan? We're AA right now, and there's no doubt that the monetary markets and the rating agencies are watching Ontario with a microscope to make sure that what goes on here somehow brings the deficit under $10 billion. Whoa. Under $10 billion and we're succeeding. What a rotten success story that is, to be able to say, "Hey, we brought the deficit under $10 billion." There's nothing to brag about in that. It wasn't all that long ago that we were upset when the deficit was just becoming $10 billion. Now we're used to it.

We've got to get used to what is right and proper for the province of Ontario, live within our means, stop living beyond our means, go for a balanced budget, see how long it will take to eliminate the debt. A debt is nothing more than a deferred tax, and we are going to tax our children and our children's children and their children after them if we don't do something to reduce the amount of deficit and debt that this province is incurring.

There isn't any doubt that the province is in trouble. We're in trouble, and until the government begins to understand that we're going to do something about it, then the province will continue to just sort of float rather than move forward; it will continue to just stagnate rather than grow and be dynamic; it will continue to have a 12% unemployment rate rather than to have the growth where people want to invest in the province of Ontario.

That's one thing that happened during the early 1980s: There was a recession on but the government in power at the time created a climate for investment. What this government does is create a climate for people to get the heck out. Why would you want to come along and invest in the province of Ontario with Bill 40 and the labour legislation? Why would you want to invest in Ontario when all the money you earn is going to be taxed? Why do you want to come along and settle here? The most beautiful jewel in this country, Ontario, and yet what we've got is a government that's driving us into the wall, driving us into the ground. So we come along now, and today, meekly and quietly, let's go and borrow another $16 billion. Come on.

I want to look for a moment at some of the recommendations our caucus made prior to the budget, none of which have been accepted by this government. That's part of the frustration of government, that there's no way in which people in this place, other than the inner cabinet, decide what's going to happen. In fact, the sad part is that the backbenchers, who are well represented in the House right now, have no participation in this process. It's announced to them. They don't know what's in the budget until the day the Treasurer or Minister of Finance comes and tables his budget. That's why it's kept under wraps and is very secret, because he's gathered all the data, gleaned it out and comes forward with it.

I'll tell you that in my years as a parliamentarian here, and it's over 12 years now since I've been elected to represent the great riding of Markham and I'm glad to represent the people of Markham, I just wish I could do more about what's happening in cabinet by being there to influence the decisions, but I'm not; I'm sitting in opposition with 21 others who really care about what can happen in government.

Our committee, two of our members, brought forward a series of recommendations on behalf of our caucus during the pre-budget consultations. I barely have enough time to cover them, but they have to do with ways in which we can operate as a province and as a government without continuing to borrow money.

Get out of the habit; break the habit. It's like anything else that takes you over. It's like alcohol or gambling or drugs. It becomes habit-forming when you start living beyond your means. Break the habit of spending money you don't have. That's what you have to do. Don't continue to be habit-forming on these things.

The kind of thing we have suggested in our recommendations is, first, "that the 1993 budget should not increase any taxes or fees and should not introduce any new taxes or fees." Don't increase any taxes or fees and don't introduce new taxes or fees. Well, I'll tell you, they did it. This government brought in the new taxes. Don't underestimate what they did to the Ontario taxpayer. They increased our personal income tax by 3% retroactively. What a sleazy, dirty, rotten trick by a government.

Interjections.

Mr Cousens: That's right. Retroactive? Come on. There's no honour among thieves. You guys are thieves. You're stealing from the taxpayers through your increased personal income taxes. You've introduced the sales tax on auto insurance, on group plans. You've introduced the tax on beer and wine in self-made establishments; public land rental use increases; snowmobile registration increases; parking fees increase; warranty parts and labour shall be subject to the sales tax and on and on and on. Is there any doubt? Here's a government that found ways to increase taxes, and did it ever do it.

1750

The other thing is that most Ontarians don't understand how bad this budget is going to be because most of them haven't been taxed yet. Wait till July 1 starts and they get their first paycheque in July. Wait till the phone starts to ring: "Why has so much money has been deducted from my paycheque?" I'll tell you why: 61% of the Ontario government tax comes off.

It's terrible what you're doing, and the people haven't seen it yet. There would have been an outcry if they had begun to see something in their pocket earlier. You saw it from the insurance brokers. You saw it from a few. It will begin to happen now, and the people in Ontario will not forgive the New Democratic government for the hefty tax increases, a $2-billion total tax increase this government is going to collect in one fiscal year. What greed, what poor spending, what a horrible example. The only one you ever beat was Bob Nixon, who had the previous high. Now you've beat him. So there you go.

Our second recommendation was that the commercial concentration tax levied in the greater Toronto area should be repealed. Do you know something? A lot of people say it's been repealed. It has? I haven't seen the bill in the Legislature yet. I suppose we'll debate it some time from now. I haven't even seen it tabled. I should have, but it isn't there. But in the budget it has been announced that the government is going to repeal the commercial concentration tax. That's just fine.

What has happened, though, is that at the same time the government has come along and is going to charge money on parking meters. They're probably going to make more money on parking meters than they did on the commercial concentration tax. So what they've done is that they've taken away the commercial concentration tax, which no one liked, and slipped in an 8% provincial sales tax on parking. So where's the win on it?

I don't know, and to get an answer out of this government is just next to impossible. You can write them a letter and you might get an answer a year later. You just don't get answers. Ask anyone. It's become the most inefficient, incompetent group of administrators you've ever seen. Ontario, which once ran things well, is now just running into the ground. There isn't any sense of urgency in dealing with the needs of people.

Anyway, I'll ask the government again and again: How much money are you going to make on the new sales tax on parking meters and on parking lots? You got rid of the commercial concentration tax, but how much more are you making by having another tax instead?

Our caucus is saying, hey, don't increase the taxes so much. Get the lid on it. Get the lid on your spending. Get the lid on your programs. Have a review of what you're doing. Don't continue on this spending spree of money you don't own, money you don't have, money that's going to be part and parcel of the future inheritance of those who come after us.

Another point we made in our recommendations: "To prevent the flight of capital from Ontario and to maintain a positive investment environment and to encourage a return to profitability, that the government include in the 1993 budget a clear and definitive statement that it will not, during its term of office, impose a wealth or estate tax or a corporate minimum tax." Well, they didn't bring in the wealth tax and they didn't bring in the estate tax, but yes, there they did. Maybe we did an injustice to the province by even suggesting in our pre-budget consultation not to do it. If we say don't do it, they do it.

Anyway, we genuinely believe it's a demotivator for business. It's just another example of the government trying to skim more money off the people who are trying to get business going here in Ontario. I've asked questions on this particular issue in the Legislature and have never received a satisfactory answer from the Minister of Finance. Certainly the presentation that was made by the Board of Trade of Metropolitan Toronto pointed to the fact that in the United States, where they've had a minimum corporate tax in the past, they're removing that. They're backing away from it because it has become such a serious demotivator for business people. It just takes away that incentive they would otherwise have to continue to invest in a certain jurisdiction.

We do not need more taxes. We need to run government more efficiently. We need to review programs. We need to do a number of things.

There are a number of other points I have: "That for the 1993-94 year, the province should hold spending on its operating account at the 1992-93 level and inaugurate a multi-year program spending freeze with the objective of balancing the operating account in three years." In other words, everybody has to start finding moneys wherever they can. Hold the level down.

Here in this year, 1993-94, the government, with all the spending restraint program and everything else, is going to spend more money than it did last year. People don't believe that, but they are.

Mrs Irene Mathyssen (Middlesex): Why?

Mr Cousens: You ask why. A lot of it has to do with all the special programs the province is bringing out. There isn't any doubt, and we mention this further in our recommendations, that the cost of your housing program is just inordinate. In fact, I'll go right to it. It's one of the biggest, most costly enterprises that the province has ever had. It's subsidizing bricks and mortar. We're saying, "The government should revamp its housing policy to help individuals and families meet their housing needs through direct shelter payments instead of planning to build another 20,000 housing units." You just don't begin to understand how large a dollar it is, because the subsidies that the government could pay would be a pittance compared to the operating costs of the new structures the government's going to be building.

Mr Bob Huget (Sarnia): You don't know what you're talking about.

Mr Cousens: The honourable member says we don't know what we're talking about. That's all part of the arrogance, the absolute arrogance of the New Democrats, who say no one knows what they're talking about except them. You come along, spend the money and don't even give a flying hoot about anyone else. Oh no, anyone else who criticizes what you have to say is arrogant. It is not arrogance. It's facing up to the reality and the truth, and there's no way we can get you guys to listen. Why don't you understand --

Interjections.

The Speaker: Order, the member for Middlesex.

Mr Cousens: -- that there's another point of view rather than the socialist viewpoint that you've got, that there is a way of going ahead to do something about it, without just spending money without taking some accounting of it. That's the lunacy of a socialist government in Ontario. We don't need you any more. I'm telling you there is a problem here, and the problem is still spending too much.

We're saying you can save money on providing proper housing for people by giving a shelter allowance rather than building brand-new places. You don't need to build them.

I have a friend with an apartment building and he knows exactly what it is. They moved from a minimal cost in an apartment building and now they're going into a plush, three-bedroom apartment. They're only a single couple. They've gone from his one-bedroom place to a three-bedroom place in Ajax, totally built and paid for by the province of Ontario at a cost over $300,000 a unit to build. He now has an empty place and they've moved into Ontario-provided housing: $300,000 to build, and then a continuing maintenance and operating and everything else. Why not look at some subsidy to help these people out instead of just building 20,000 more units this year? What a waste.

And here today we're coming in for another $16 billion, and what are we supposed to do about it? Vote for it? I'm not voting for it. No way. You're not getting another cent. Come on, live within your means. Learn to live within the money you've got. You're not in a position to continue to spend as outrageously as you are now. We've got sincere and serious recommendations to make, and this government should start paying attention to them.

I'm running out of time. Since it's 6 of the clock, I move adjournment of the debate.

The Speaker: It's not necessary to move the adjournment of the debate. I recognize the honourable member for York Mills.

Mr David Turnbull (York Mills): On a point of order, Mr Speaker: I was informed earlier today by the Minister of Education and Training that he would be unable to attend tonight's late show and has requested me to defer it. I would ask unanimous consent of the House to defer the late show till next week.

The Speaker: Do we have unanimous consent? Agreed.

Is there a business statement?

Hon Shelley Martel (Minister of Northern Development and Mines): With respect to the business that will be dealt with tomorrow, it will be announced tomorrow morning.

The Speaker: It being 6 of the clock, this House stands adjourned until 1:30 of the clock tomorrow.

The House adjourned at 1800.

29 juin 1993