Assemblée législative de l'Ontario

L053b - Mon 2 Nov 1998 / Lun 2 Nov 1998 1

ORDERS OF THE DAY

LIQUOR LICENCE AMENDMENT ACT, 1998 / LOI DE 1998 MODIFIANT LA LOI SUR LES PERMIS D'ALCOOL

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The House met at 1832.

ORDERS OF THE DAY

LIQUOR LICENCE AMENDMENT ACT, 1998 / LOI DE 1998 MODIFIANT LA LOI SUR LES PERMIS D'ALCOOL

Mr Tsubouchi moved third reading of the following bill:

Bill 57, An Act to amend the Liquor Licence Act in respect of brew on premise facilities / Projet de loi 57, Loi modifiant la Loi sur les permis d'alcool en ce qui concerne les centres de brassage libre-service.

Hon David H. Tsubouchi (Minister of Consumer and Commercial Relations): As members will recall, there was all-party support for this bill when it came before the Legislature for second reading. In fact, we were complimented by some opposition members on producing what they described as a timely bill backed by succinct arguments. Those arguments include the need to clarify the rules about customer involvement in the making of beer and wine in brew-on-premise establishments. This would help to ensure that these facilities are operated, as originally intended, to provide a service to people who don't have facilities in their own homes nor the equipment to make their own beer and wine.

Most brew-on-premise operators provide a legitimate opportunity for hobbyists to make their own beer and wine. However, some operators require a little participation by the customer in the manufacturing process and some operators are becoming more like breweries and wineries.

Clarifying the guidelines has been requested by the Brew on Premise Association of Ontario, which represents brew-on-premise operators. The association says that the lack of clarity is putting operators who do follow guidelines at a competitive disadvantage. Clarifying the rules and establishing an acceptable level of customer involvement in the manufacturing process in standards to be set in the regulations will ensure fair and consistent treatment for everyone.

This legislation will in no way restrict the ability of consumers to make their own beer and wine. We made this point very clearly in our remarks during the second reading debate but feel it should be emphasized again. Indeed, many thousands of people across this province use the services of brew-on-premise operators to make their own beer and wine, and the brew-on-premise sector is providing a valuable service.

We also made some remarks at that time that may have escaped some members' notice. I refer to a comment during the debate to the effect that introducing new regulations appeared contrary to the government's fight against unnecessary regulations and red tape. However, I would like to repeat what was said at the time, and that was:

"It may seem out of character for this government to add more regulations. Members should note, however, that the Red Tape Review Commission supports this initiative. As a matter of fact, the commission met with stakeholders and worked with them to ensure that the regulatory principles that were put in place would guide the development of standards."

We thank the members for their support of this bill.

The Acting Speaker (Mr Gilles E. Morin): Questions or comments? Further debate?

Mr Mike Colle (Oakwood): I'll be very brief. Our party and our caucus support Bill 57, which is commonly known by a lot of people as the you-brew bill or the brew-on-premise bill. As the minister said, it doesn't restrict people who want to continue to brew beer or wine in their own homes. Also, it doesn't go contrary to the small you-brew premises which are popping up all over Ontario, whether it be for wine-making or for beer-making. These are generally small, independent operators. There are some franchises involved, but generally these are people who have storefronts. They're certainly all over the greater Toronto area, where people who don't have facilities in their apartments or homes use the services of a professional who guides them in how to properly brew wine or beer.

What this bill does, which is needed, is to put in guidelines and benchmarks so that there aren't unscrupulous people who manufacture beer or wine for sale who don't go through the same rules that the solid businessperson or entrepreneur has to go through. It tries to put everybody on the same level playing field so there are the same rules for everyone.

It's necessary because this is a growing industry and an industry that's in every community. Therefore, the consumer is asking for these protective, uniform guidelines so they could be dealing with a bona fide you-brew provider, whether it be beer or wine.

The major established manufacturers and brewers of beer or wine are supportive of this because it tries to ensure that there isn't ad hoc brewing taking place without the same type of rigorous guidelines as for the main players, that people have to pay all the taxes and abide by all the government rules. It's protection for the consumer and at the same time it gives people in the industry, who have to put major investments into the brewing of alcohol, wine or beer, some protection.

The appreciation of fine beer and fine Ontario wine has really exploded in Ontario in the last couple of decades. At one time, it was rare that you would go into a restaurant and see a bottle of wine on a table; you would see people having everything but wine. Now you can see Ontarians of all stripes enjoying good Ontario wine, and also they're enjoying good beer. At one time it was just your basic beer that Ontarians were drinking. You remember the ones drinking old IPA? I call them the old IPA drinkers. Well, we've gone beyond the old IPA and we see people now appreciating fine-brewed micro-brews or speciality beers by the major manufacturers and brewers. It's part of Ontario's socioeconomic fibre that drinking beer and wine as part of your meal, in moderate, controlled fashion, is quite acceptable, It's an industry that employs a lot of good, taxpaying Ontarians.

Bill 57 is supported by our party because we feel it's part of making the rules apply across the board so there aren't people playing outside the rules, so at least there's an attempt to treat everyone fairly. I think the consumer in the long run benefits by such legislation and that's why we're supporting it.

1840

The Acting Speaker: Questions or comments? Further debate?

Mr Colle: Mr Speaker, I forgot to mention that the member for Kingston and The Islands wanted to add a few comments about the grapes in the Kingston area.

The Acting Speaker: Is it agreed? Agreed.

Mr John Gerretsen (Kingston and The Islands): Actually, I think I should put the House on notice that we have a number of different speakers who want to speak on this.

Mr Tony Silipo (Dovercourt): You mean I should have said no?

Mr Gerretsen: Maybe you should have said no, but we do and they're on their way down right now.

Let me start off by saying, as the member for Oakwood has already said, that we support this bill, this initiative, because we realize that it's supporting small business in Ontario. This is one of the very few measures with which this government has supported small business.

I know they like to give out the message or have people believe somehow that they are a party for the small business individual in Ontario, but their actions over the years, and particularly this year, have shown anything but that concern for small business. I suppose the best example of that is the whole property tax mess out there currently. As we know, over the last couple of years, six different bills have been introduced to deal with the property assessment and property tax situation in Ontario.

Mrs Brenda Elliott (Guelph): Speak to the bill.

Mr Gerretsen: I am speaking to the bill. I am speaking to the small business aspect of this bill and how this bill is helping a particular small business, but I'm also talking about the fact that in many other respects this government has attacked small business. There's no better way to show that over the last year or so than with respect to the property tax situation.

It's very interesting that the Minister of Finance in September of this year stated that he was going to bring the House back earlier so that he could deal with the assessment appeal situation in the province. That's why the House was brought back on September 28. I think we debated that bill for exactly one day and after that it never came back again, because the minister realized after a while that he still had messed it up.

Now we hear that another bill is being brought forward, presumably sometime this week, to put limits on the increases and the decreases that the small business individuals and small businesses in the province will get this year. I'm talking about small business, and this is a bill dealing with small business. We know there are 450 you-brews in Ontario, all enterprising businesses that have multiplied over the last number of years. It's the kind of entrepreneurship that I think we can all be extremely proud of in Ontario.

Interjection.

Mr Gerretsen: Yes, I'm talking about the you-brews, Mr Speaker.

The Acting Speaker: Not quite.

Mr Gerretsen: I'm talking about the you-brews and the fact that there need to be some regulations with respect to those you-brews to make sure they're operating in a proper fashion. That's what this bill is all about.

I'm talking about the fact that there are many other areas that small business is concerned about, and one of them is the property tax situation. We know that there are many situations in the small business community where taxes have gone up anywhere from 30% to 100% to 200%, and those people want relief. They want relief. They want to know, "Can I appeal my assessment?" At one time they were told, "Yes, you can, before October 31." October 31 went by and new legislation was not passed. Now the government is saying it will be December 31, but with one major change, and that change is as follows: that for this year, the most that anybody's taxes can increase in the small business community is 10%. On the other hand, though, a property owner's taxes cannot decrease by more than 10%. So we've got the ridiculous situation where somebody who received a tax bill earlier this year, probably within the last couple of months, which clearly indicates -

Interjection: It could be a you-brew.

Mr Gerretsen: It could be a you-brew. Many you-brews got a tax bill that said, "You owe us $3,000," let's say. Let's say they'd always paid $5,000 in property taxes and as a result of the assessment being changed it is now $3,000. That you-brew feels happy about it, quite happy that it's now only paying $3,000 in property taxes whereas last year it paid $5,000. Now they are going to get a tax bill saying: "Remember the bill you got last month that said you had a $2,000 decrease over what you paid last year? Sorry, but we can only decrease your original bill by 10%. In other words, you'll have to pay us $4,500," which is a $1,500 increase over what they thought last month they were going to have to pay. That is a travesty, and it's something that small business simply cannot put up with.

Even though this government likes to give the impression that it wants to help small business, there are many, many areas where it's not doing that. I just ask the small business owners in Ontario to keep a very close eye on that, because sooner or later that bill will have to be brought into this House, will have to be debated and will have to be voted on. At that point in time, yes, the increases that some people are subjected to are going to be capped at 10%, but at the same time any decreases will be -

The Acting Speaker: Take your seat, please. I'm trying to relate your presentation to the bill, and I have difficulty finding a link to it. I would ask you to really talk about the bill. I'm being fair with everyone. Talk about the bill. Really talk about the bill.

Mr Gerretsen: Thank you very much, Mr Speaker. Let me then refer you to an article in the Globe and Mail that dealt with this particular you-brew situation, an article dated October 12, 1998. It says that the province is preparing a bill to regulate the you-brew industry, which is really what this is all about. The irony about this is that here we have a government that is against regulations. It wants to get rid of as many regulations as possible, whether we're talking about the environment or many, many different areas, yet here they want to introduce more regulations. I find that somewhat ironic from this government.

I, for one, believe that good regulation is necessary in all areas. It's necessary in the you-brew business and it's necessary in many other businesses out there. I do not have anything against regulations and rules to start with, not like some of my friends on the government side, who believe that if we just do away with all rules and regulations, it's a dog-eat-dog world and somehow the fittest will survive. That is their attitude about most of the endeavours they place in this chamber. My attitude is that good regulation makes sense, and this is a perfect example.

An industry started some 10 or 15 years ago and there's now a realization that there have to be some rules and regulations set up for the protection of the general public, for the protection of the people who use the you-brews as places where they make their wine and their beer. Even the you-brew association has said, "We need some regulation so that everybody knows there are certain standards expected of these businesses."

I think it is a good idea to have these kinds of rules and regulations. I'm saying that in this party we don't go along with the idea that we just do away with all rules and regulations. There should be regulations within certain industries, and this is certainly one of them.

1850

Yes, we support the bill, but I also say to this government that you have done more harm to the small businesses that operate in this province than probably any other action by any other government in the past. They don't know what their real estate taxes are going to be. Even those people who have received their bills this year may get another bill later on this year that tells them, "You may have seen a decrease in your last tax bill and you may have been happy about that, but it doesn't mean anything, because as a result of a new bill that's being introduced and passed it may be limited to only a 10% decrease over what you paid last year."

With that, I turn it over the member for Windsor-Walkerville.

The Acting Speaker: I just want to remind the member for Windsor-Walkerville that we're debating Bill 57, please.

Mr Dwight Duncan (Windsor-Walkerville): I'm pleased to join the debate tonight on Bill 57, An Act to amend the Liquor Licence Act in respect of brew on premise facilities, the so-called you-brews.

Let me begin my brief commentary tonight by saying that that I too support this bill, as does the official opposition. It's an important piece of legislation that merits the careful consideration of the Legislature.

Mr Speaker, you asked me to address the bill. I'd like to read to you the very first line of the bill, and I'd like to read this line particularly to the government members because it speaks so eloquently. It says: "Her Majesty, by and with the advice and consent of the Legislative Assembly of the province of Ontario...." Referring specifically to that line, how often has the opposition not been able to advise? How often has debate been cut off, as it was tonight? That line is extremely important and contained in the bill.

I remind government members, when you closed debate today, as you have on so many occasions - and I must say the NDP had a habit of closing debate; I remember they shut down debate on the social contract. In every one of your bills, including this bill, the very first line says, "by and with the advice and consent of the Legislative Assembly." That means - not only does it imply; it means - that we on all sides of the House ought to have a commitment to full and fair debate. That line I wanted to take the opportunity to address specifically, as it does very clearly say that we should have advice and consent.

The you-brew industry is interesting. I think we've all watched it grow and evolve in our communities. In my community, a number of individuals I know take advantage of the you-brews, take full advantage, and have saved quite a bit of money in doing so.

This act attempts to initially put them on a fairer playing field. It talks about licensing, and licensing implies fees. Section 2 of the act amends the Liquor Licence Act to say, "No person shall operate a brew on premise facility," that is, a you-brew, "except under the authority of a licence to operate such a facility." Licensing implies licensing fees.

I was looking at the public accounts the other day. I remember Mike Harris, the Taxfighter, when he used to say, "A tax is a tax is a tax." Well, you know what? Fees and other revenues of the government of Ontario have quadrupled since the Harris government was elected in 1995, absolutely quadrupled. When I read that section of the bill, "No person shall operate a brew on premise facility except under the authority of a licence," what that means to the people who are watching out there, people who use you-brews, use them frequently, is that there will be a licence fee attached to it. Like so many other fees, whether it's vehicle registration fees or any kind of fees the government of Ontario charges, those fees will impact on individual consumers.

We look at this and we support it. I'm reminded when we deal with you-brews that where I come from, we have some of the finest wineries in Ontario. We have Pelee Island Winery, we have Colio Estate, Harrow Estate wineries - fine wineries indeed. Their product is exported worldwide. It's winning awards worldwide. We have to remember those industries and how many people they employ.

Mr Gilles Pouliot (Lake Nipigon): What's the range?

Mr Duncan: The member asks what the range is. I'm not sure I understand his question.

Mr James J. Bradley (St Catharines): Right around the world.

Mr Duncan: Oh yes, indeed, they sell right around the world, to traditional wine-producing countries - Italy, Germany - and others. We're very proud of those wineries.

It's important that we recognize the significance of those industries and the impact of regulation on those industries, the impact of all forms of taxation. My colleague spoke earlier about (1) the impact of regulation and (2) the impact of taxation. Let us be clear on this side of the House: As Liberals, we believe that there is a legitimate place for regulation of all industry and that the government has an obligation to regulate and provide a fair playing field in many instances, both for consumers and producers.

We don't have a problem supporting this bill, but my colleague from Essex will talk about this issue of enforcement. Do you know that because of Harris government cutbacks there's only one liquor licence officer in the entire county of Essex right now? I wonder who is going to enforce this bill. This bill envisions enforcement. It envisions licensing and consequently enforcement. How will the government enforce this particular piece of legislation?

I'm referring again directly to the bill. It says that the government will regulate and license, and therefore the obvious question is, when you've cut the Ministry of Consumer and Commercial Relations, when in Essex county you have but one liquor licence officer to enforce not just this regulation but all the regulations under the Liquor Licence Act, one simply must debate in the Legislature what the impact of those cuts is going to be.

Interjection.

Mr Duncan: It may well be that the NDP cut them, that may well be the fact, but the simple fact remains that you do not have the staff or the manpower to enforce your existing laws and regulations.

We have a new you-brew that's sprouted up in Walkerville, which is in the heart of my riding. Indeed, my riding is named after Walkerville. There's a high school named Walkerville as well and it's one of the schools that's being considered for closure right now, right in Walkerville, not far from the you-brew.

This bill doesn't deal specifically with that, but we have not only to focus on these legislative items such as this bill, and this bill will regulate you-brews in Walkerville, but as an opposition we also have to talk about the impact of budgetary policy and how it affects every community in our province, whether it be the closure of 40 hospitals, as this government has done, or the closure of potentially 600 schools across Ontario, which this government has done.

We can support this legislation, but it has to be debated and discussed in the context of not only the advice and consent of the Legislative Assembly, but also within the context of the government's budgetary policy: what it applies to enforce its laws and its regulations, what it does in other parts of the economy and to other parts of the community.

I wanted to end by saying that we welcome this kind of legislation. We feel it'll provide a fair playing field for all producers of liquor and alcohol, but I wanted to end too by referring back to the market issues that are confronting you-brews, which are small businesses, that are confronting large employers, and that is property taxes.

My colleague from Kingston and The Islands put it quite fairly when he talked about the unfair tax hikes that the Harris government is putting on small business in this province. You-brews are small businesses. This legislation is designed to regulate them. Property tax increases as large as are contemplated by the revised assessment schedule in Ontario will affect them also.

Yes, the government has come in with its seventh bill to now take control of municipalities' ability to set tax rates and to fix the problems that the government itself has created, but I would suggest that that is simply a delaying mechanism, that it won't deal with the problem you-brews will face with increased tax burdens in municipality after municipality after municipality.

1900

As we pass this bill, as we begin to regulate you-brews in this province, let us bear in mind, I say to the government members, that this bill's functioning, this bill's ability to regulate is only one small part of the equation. It must be considered in the context of the broader budgetary policy of this government and its taxation on small business.

We regret what the government is doing to small businesses and municipalities. We regret that the government has had to cut so deeply that it can't enforce its own regulations and acts, but we do support this bill as it's an important step in the right direction.

We urge the government to reconsider the closure of schools like Walkerville and W.D. Lowe and hospitals right across Ontario. Those kinds of budgetary policies hurt people, hurt small businesses, whether it be you-brews or other types of businesses. While we support this bill, we reject entirely this government's policies with respect to education, health care and small business.

Mr Bruce Crozier (Essex South): I am privileged to rise this evening to add a few comments to those of my colleagues with respect to Bill 57, An Act to amend the Liquor Licence Act in respect of brew on premise facilities.

I want to put the debate on this bill tonight in a little bit of context and the reason I too am rising in support of it. So often with this government, when I've wanted to speak on bills - obviously, Speaker, you and I and all of the other of my colleagues in this Legislature are sent here to express the opinions of our constituents, but all too often, as has been seen with this government, we bring in time allocation. I thought I should get in on the speakers' list early this evening because, goodness knows, probably the government's going to bring in time allocation on this. In fact, it's surprising to me that they haven't brought in time allocation on bills before they're even presented, because it's getting that bad.

But we do support this bill, for a variety of reasons. The brew-your-own industry in Ontario provides about 4,200 jobs, and that's good. When you take into consideration the number of people the you-brew industry employs, take into consideration the number of people the larger brewers and winemakers employ, it's an important part of our economy.

As has been mentioned before, but deserves repeating, since 1988, in only the last 10 years, 450 you-brews and you-vin stores have opened in the province. That shows us that people are not only interested in brewing their own beer and wine at home, but they're also interested in the equipment that perhaps makes a little better brew of beer or a little better wine available to them. That is allowed under the you-brew operation.

Homemade products represent more than 3% of the total wine consumption in Ontario. That's not a lot and that's why I think the regular Ontario domestic wineries can also support this legislation, because it brings into place some regulation in the you-brew area. The Brewers of Ontario trade association's latest estimate is that 5.5% of beer consumed in the province is home-brewed. That would amount to about 42.5 million litres, or the equivalent of 5.2 million cases of 24 beer. When you take it in the overall context, it's not a lot. I remind ourselves that Canadians bought two billion litres of commercial beer last year and 250 million litres of wine. So although the you-brew sector is not a large one, it is one that needs to compete fairly and on an even playing field and be balanced competition when it comes to the overall industry.

The brew-on-premises industry has worked hard to develop their business. I think that's why they're willing to work with the government of Ontario in order to regulate the you-brew industry to some extent, so that they can continue to do a good business after having worked so hard to develop it in the first place.

Aside from prices - and there is some price advantage to brewing your own - many consumers simply prefer the opportunity to create their own beer and wine products with a minimum of investment in equipment and supplies, and that's what the you-brew industry provides for them. They can go in and use the equipment along with others who have the same interest, which therefore makes it less costly to them. The you-brew industry provides that opportunity.

We are supportive of this bill because we have the support of the you-brew industry, which is trying to define a secure regulatory framework for this industry. Having done this, we think the larger brewers and winemakers will also agree with the legislation that's being presented.

There are several areas in which people have the opportunity to obtain wine and beer for their own consumption. One is that they can make it at home on their own, and this can't be for resale. In my area - I suppose it's indicative of many areas in the province - we're quite proud that we have some of the finest home-brewed and home-created wines by the German community. They make some fine homemade wines and beers that have been brought along with German recipes. We have the Portuguese community who certainly like to make their own wine at home.

This is an industry in itself because as you get into the fall there are all kinds of signs around the riding where grapes are available that have been brought in from a variety of regions that they can use to make their own wine at home.

The Italians make some of the finest homemade wines that you could ever want in our area. When I campaign in the great municipality of Amherstburg, it's a treat to visit the homes on Texas Road and to appreciate the hospitality that's given to you there when at each household -

Mr Gerretsen: Texas Road?

Mr Crozier: Texas Road it's called, yes, in Amherstburg, where you see some of the finest hospitality you would ever want to enjoy with the residents. They're proud of their homemade wines.

Then, as we're speaking tonight about Bill 57, we have the areas in the riding where you can go to a you-brew place of business and use their equipment, get some assistance from them, use some of the recipes they have and participate in the you-brew industry in a commercial aspect.

1910

Notwithstanding the fact that many fine wines and beers are brewed at home and many fine wines are made and beers brewed at the you-brews, all of us from time to time want to enjoy commercial wines. In connection with this, as an option we have I think four of the finest wineries in the province of Ontario, and perhaps in the Dominion of Canada, which are earning their way in the world of excellence when it comes to wine, one being the D'Angelo winery, which is an estate winery in Amherstburg.

If anyone should care to come down to Essex South some time we have the North Shore wine route where you can follow a tour starting with the D'Angelo winery in Amherstburg. You can go on to the Colio winery in Harrow as an alternative to the you-brew and the home-brew market. I dare say the Minister of Consumer and Commercial Relations is going to join us in Harrow on November 12 this year at the Colio winery. I welcome him to our fine riding to do that. The only problem the minister may have is that one of the finest high schools in Essex county is under the axe, that being the Harrow District High School. I certainly hope the province has considered its position on rural schools and that by the time the minister arrives there I'm able to tell him that the Harrow high school is able to continue open and make that community viable, because goodness knows a business like Colio wines and/or many other business in the town of Harrow may not be there were it not for the very fine schools that have been provided in that community. I hope the Harrow high school is one of those that continues.

If you're still on that North Shore wine tour, you can just go up a few concessions north of Harrow and visit another small estate winery, which is the LeBlanc winery. They, as well as the others, make some of the finest domestic Ontario wines you could ever want to have. Lyse LeBlanc, the wine master there, will certain welcome you to her winery. She knows that her wines are as attractive to anyone as would be the wines that they might make at a you-brew or at home.

Then as you continue a bit east, everyone would want to stop at the Pelee Island Winery. In fact, they might even want to go to Pelee Island because without question some of the finest grapes in Ontario are grown on Pelee Island. It's a small island out in the middle of Lake Ontario. The climate is moderate. I'm sure that Pelee Island, along with Colio - maybe even LeBlanc and D'Angelo - supply grapes and concentrate to the you-vin shops throughout the province.

This is all tied in to one in that it gives the consumer a choice: They can either brew their own wines and beer at home, they can use the you-brews as they're now going to be regulated on a fair basis with the industry as a whole, or they can choose to buy some of the finest wines that are made domestically, in the great southwest of Ontario, in the most southerly riding of the province. They would do well to take a trip to Pelee Island. Take the Jiimann or the Pelee Islander and go and visit Pelee Island. Buy some of the grapes that are over there perhaps or even try some of the great Pelee Island wines that we have.

It isn't difficult for me to support this bill because in supporting it we support the whole wine and beer industry by giving our constituents, the people of Ontario, a choice. I would hope that everyone who wants to is given an opportunity to speak on this bill and that in doing so we just encourage small business in the province of Ontario so that it may prosper.

Mrs Lyn McLeod (Fort William): I'm happy to participate in this debate tonight on Bill 57, which is making provisions under the Liquor Licence Act for brew-on-premises beer and wine facilities. The issue of you-brews or brew-your-own stores has been a subject of some debate off and on for the last few years, since this industry has been a growing industry despite some of the very real challenges it is facing.

The bill we're debating tonight, Bill 57, is of considerable importance to the people who have small you-brew businesses and to the some 4,200 people in the province of Ontario who are employed by the you-brew business. Surely this is an industry which fits into the government's category of small business, which in theory their party wants to provide support for. In practice, of course, we know that most small businesses in Ontario are experiencing incredible tax increases because of the dumping on municipalities that this government has enforced and the fact that that dumping is leading to very significant increases for most small businesses. It's no wonder that the you-brew people have been anxious about the issue of taxation on their businesses and want to ensure that there is a relatively secure framework established through legislation and through regulations that will provide some consistent ground rules on which they can start up and continue their businesses with the expectation of reasonable financial viability.

I'm rather surprised. It's my understanding that the members of the government, despite the fact that this is a bill about small business, a good-news bill - as I understand it, probably all three parties are likely to support this bill. Certainly our party has indicated that we feel it is timely for this bill to come forward and we have not raised significant objections to the details of the bill. So it surprises me that the members of the government are not going to put up speakers tonight. I find myself wondering why that would be the case.

Mr Gerretsen: I think they're really against small business. They're only in favour of big business.

Mrs McLeod: It may be that they're little bit nervous about ever talking about small business in a debate situation, where the rest of us might want to talk about whether this government really has provided support for small business or whether it has made small business non-viable because of its taxation in so many areas. But I know the Speaker is anxious that we speak very directly to the you-brews, so I'm not going to get into a long, discursive discussion about what the government has done to small businesses in a whole lot of other respects.

I'm surprised, and I say it again, that there are not government members who want to speak to Bill 57 tonight, because this is trend-setting legislation, precedent-setting legislation. Perhaps we're not aware of the significance of bringing forward this legislation tonight or the fact that it's being watched across the country. There are only two provinces, as I understand it, that actually have you-brew operations sanctioned within their provinces, Ontario being one and British Columbia being the other. To the best of my knowledge, British Columbia has not brought forward legislation of the kind we have before us tonight, so Ontario's legislation, the intent of the Ontario government to actually provide regulations to provide some stability for this relatively new industry, is considered to be trend-setting and precedent-setting. Other provinces are going to look at it and determine whether this is a basis on which the you-brew industry can be encouraged in their province. So it's of significance, and I would have thought it was of such significance that we might have had speakers from the Tory party prepared to talk about this precedent-setting legislation they're bringing forward.

I understand that the New Democrats are also not going to put up speakers tonight. I think I understand that a little bit better, however, because it was the New Democrats in 1993, when they were rather desperately looking for ways to deal with the $10-billion deficit they had managed to create for the province, when they were looking for any sort of taxation they could find to offset the deficit, who decided that the tax-exempt status of the you-brews was something they might be able to deal with, and they brought in taxation which virtually threatened to put the you-brews out of business. So I understand why the New Democrats are not anxious to participate in this debate this evening.

But I would have thought the members of the government would have been more than anxious to come forward and talk about the benefits of this particular bill, the initiative that their own government is taking to provide stability to what has become a growth industry in the province of Ontario.

The other reason it's surprising that they're not speaking tonight is because I think this bill is relatively non-controversial. That was not always the case. There was a time a few years ago when the whole issue of the tax-exempt status of the you-brew industry was extremely controversial. We had representations from the Ontario wine industry, which, as my colleagues have said, is a well-established and very important industry in the province of Ontario, and we had representatives from the distillers' industry, who questioned whether the you-brews were going to take an increasing part of their business and had a competitive advantage because of their tax-exempt status.

1920

It's probably more correctly referred to, as I understand it, as a taxation benefit for the consumer in recognition of the labour the consumer actually puts into brewing their own beer and wine. That, of course, is the basis of the legislation before us today. It attempts to put some regulations in place so it's clearly understood at what point this is an individual consumer who is making a product for his or her own consumption and therefore should be entitled to some tax advantage over those who are into the business of making beer and wine for clearly commercial purposes, and when the business crosses that line and becomes a commercial business, not an essentially consumer-driven business, with the consumer providing his or her own labour.

We welcome the legislation because it attempts to provide that regulatory framework. My understanding is that the brewers and the winemakers in the province of Ontario have also welcomed this legislation because they too want to see the regulations made absolutely clear so that there is a playing field that everybody understands. I think the wineries have actually come to recognize that there can be some commercial advantage to them in the you-brew industry, so rather than being distressed about legislation which will recognize the future of the you-brew industry in Ontario, they've actually come to see it as a growing business with which they can co-operate, and some have become suppliers of juice and wine kits for the you-brew industry. So legislation that might have been controversial as little as five years ago I think is supported on all sides, which again adds to my surprise that only the members of the Liberal caucus seem to be rising to speak to this particular bill.

I want to recognize how important this legislation is for the you-brew industry itself and why in their eyes this is something which deserves the kind of debate it's receiving tonight. The history of the you-brew industry over the last few years has been rather rocky. They established their businesses in a tax-free environment, and suddenly in 1993 found themselves facing significant taxes which made it virtually impossible for some of the you-brews to continue to operate. Indeed, in my riding that's when I became personally aware of the kinds of financial challenges that can face you-brew businesses, these small businesses, because there were you-brew businesses in my riding that were not able to survive that initial imposition of taxation. I know the New Democrats retreated somewhat and reduced the taxes, but it's unfortunate that by not getting a real sense of what is needed for viability of a new industry in the province, there were some who were not able to survive that initial overture into an entirely new taxation environment.

That's why the you-brew industry wants to see legislation that will provide a regulatory framework for their operation, including licensing, because it gives them some protection against a constantly changing environment. I would suggest to them that if they think this means that the Conservatives in the future are not going to increase their taxes, they could be in for a little bit of a surprise. That was certainly the expectation for business generally in Ontario when the Conservative government came in, and that's why it has been such a surprise for so many small businesses to find that they're facing enormous tax increases under a Conservative government that was supposed to be friendly to them.

So I'm not sure the you-brew people can take comfort from the fact that although they are now to be regulated and licensed, they will never face increased taxes. I suspect it will be very tempting for the government, particularly if they want to campaign on a new tax cut, to look at ways in which they can tax in other places to get money for a new tax cut.

Mr Bradley: Yes, 476 tax increases.

Mrs McLeod: My House leader says 476 tax increases. I've started to lose count. That probably doesn't include all the fee increases, which according to the Supreme Court of Canada might now be considered not fee increases but taxes.

Mr Bradley: Mike said a user fee is a tax.

Mrs McLeod: Indeed a user fee is a tax. The question for the Supreme Court of Canada is, when is a user fee beyond what is required to provide a service, and then it does become a tax. Of course, one of our issues is that those taxation measures done through fee increases are not done in the Legislature. At least if the government decides it's going to provide new taxes for the you-brew industry, along with other businesses, they may have to come back to the House to do what would clearly be a tax.

I was speaking to the temptation I think it will be for the government to want to look at taxation in an area like the you-brews. When I look at the story that came out about a month ago now about the LCBO predicting record profits, one of the concerns when the you-brew industry was first established was that it was going to make significant inroads in taking away business from breweries and from commercial wineries. There were all kinds of statistics being offered about the reduction in purchasing by Canadians and Ontarians in the more traditional areas. Probably we have to say that the you-brew industry has not made significant inroads in terms of reducing the sales, certainly not if we look at LCBO statistics, because they're expected to rake in more than three quarters of a billion dollars in profit before next spring. That's going to mean record sales, and I think that's the fourth year in a row that the LCBO will have record sales.

I know, Mr Speaker, that you want us to stick strictly to Bill 57 in our discussion this evening, so I won't linger on what you might be able to use those record profits from the LCBO for. Because I've been so immersed in two things this week - one is the dire situation facing our hospital and its operating deficit, and the other, of course, is the school closings or maybe the special education students who aren't getting funding - I found myself wondering, when I look at the $761 million in profits that will be coming into the provincial treasury from the LCBO this year - again, the fourth year in which they have set a record, so this is profit above and beyond what the Harris government might reasonably have expected - I wonder what that $761 million could be used for.

That is, as I recall, almost enough to replace the entire amount that the Harris government stripped away from hospital budgets. It's almost as much as they've stripped away from education budgets. That money that is coming from the taxation and is showing as an LCBO profit, coming directly into the provincial treasury, is certainly a significant amount and could offset some of the cuts this government has been compelled to make to bring in its tax cut. I sincerely hope they're not going to use those profits for another tax cut, when there are so many needs that people are raising with them on a constant basis.

That does take me a little bit away from Bill 57. I introduced that subject because there is a direct relationship: There was a concern in the past that any recognition of the you-brew industry would take away from the kinds of profits that the LCBO has made in the past, and clearly that is not the case, because the LCBO is going to have record profits. I was suggesting it might also be rather tempting for the government in the future to look at obtaining some of that kind of revenue by looking at taxing you-brews in the future.

I'm going to conclude by again being a little surprised that the government members are not prepared to participate in this debate. I'm surprised because, as I suggested, I understand this to be trend-setting and precedent-setting legislation. I'm surprised that they're not wanting to trumpet, quite frankly, bringing in a piece of legislation which is likely to get support in the House from opposition parties, as well as bringing in legislation in an area which in the past has been controversial and which I understand is not controversial now. I'm surprised that they're not wanting to use this as an occasion to expound once again on all the things that the Harris government is doing for small business while they ignore the very negative effect they have had on small businesses with the significant property tax increases that small businesses are facing because of the Tory government.

I actually shouldn't be surprised, because I think I know why this government is not participating actively in the debate tonight. I think they would like to go home, and it makes something of a farce of an evening sitting. We're supposed to be here because we have urgent matters of public business to do, yet the government doesn't think it's urgent enough to participate in the debate. It might have been in the public interest if we had had a rerun of question period tonight so the public could have had a chance to hear debate with all members of the House participating.

1930

M. Jean-Marc Lalonde (Prescott et Russell) : C'est avec plaisir que je prends part à ce débat de ce soir sur le projet de loi 57. C'est un projet de loi qui modifie la Loi sur les permis d'alcool de façon à prévoir un régime de permis concernant les centres de brassage libre-service pour ce qui est de l'industrie de la bière et du vin.

Le nouvel article 5.1 est très clair. C'est que la commission délivre un permis de vente d'alcool, un permis de livraison d'alcool, un permis de représenter un fabricant ou un permis d'exploitation d'un centre de brassage libre-service à la personne qui en fait la demande, si sa demande est agréée par un membre ou un employé de la commission ou par cette dernière, et qu'elle se conforme à la présente loi et aux règlements et a acquitté les droits exigés.

Je crois que la façon dont nous allons procéder avec ce projet de loi va être très facile. Mais aussi, on doit dire que ça va donner un meilleur contrôle au gouvernement, non seulement que ça va aller chercher des revenus additionnels - ce n'est pas ça que nous regardons, parce que ce gouvernement, nous le savons tous, essaie toujours d'aller chercher dans le fond de nos poches des sous additionnels. Donc ce n'est pas ça. C'est que nous allons réglementer la qualité, l'accès à l'achat et aussi nous assurer que les jeunes de moins de 19 ans ne puissent pas aller se chercher une bouteille de vin qui, on le sait bien, a un certain contenu d'alcool.

Je crois qu'il est très important que les francophones qui surveillent le débat ce soir à la télévision comprennent que ce projet de loi va être une procédure additionnelle pour ceux qui sont les brasseurs de vin ou de bière dans le province de l'Ontario.

I regret that I have to revert to English in this case, but I have to bring this to your attention: In Prescott and Russell alone, with the ice storm we had, the you-brews were affected by the ice storm. I wish this government had introduced a bill that would financially help those that were affected, but we're talking about Bill 57. Just this afternoon, a dairy farmer who was also producing some wine told me that he had $300,000 damage during the ice storm. This afternoon alone, two collection agencies contacted that dairy farmer. The hydro is going to be cut off because he hasn't paid the bill.

This government hasn't given any help to the dairy farmers of eastern Ontario since the ice storm. It has been how many months? It has been 10 months now, but still we're talking about Bill 57. We have to treat all the people of this province at the same level. The dairy farmers of eastern Ontario, the business people of eastern Ontario, have been pretty much affected, and to date we haven't done anything about it. I contacted the Kemptville office this afternoon and some of them just got the adjuster appointed on October 29. What will happen at the end of this week coming? Probably the bank will seize them. I don't know what will happen.

I should go back to the French debate. But I wanted to make sure that all the members of the government side understand the crucial time we have been going through in eastern Ontario ever since the ice storm.

En ce moment, oui, nous allons supporter ce projet de loi parce que nous croyons que c'est une protection pour le consommateur de l'Ontario : non seulement qu'on va créer des revenus additionnels, c'est surtout pour le contrôle exigé, et aussi la qualité, par les règlements qui vont être mis en place par le gouvernement. Aussi, l'opposition est en accord avec ce projet de loi-là. Ça va certainement donner une bonne poussée au gouvernement de dire pour une fois que l'opposition croit en un de vos projets de loi que vous soumettez aujourd'hui, puis nous allons le supporter jusqu'à la fin de la troisième lecture.

Donc, c'étaient les points que je voulais soulever. Merci à tous les membres qui supportent ce projet de loi.

The Acting Speaker: Further debate?

Mr Peter Kormos (Welland-Thorold): I should indicate I'm not going to use up the whole hour of leadoff time here. I'm going to try to make this as brief as possible.

I should tell you first that the New Democrats are supporting Bill 57 on third reading. Down where I come from the concept of brew-your-own is not particularly new or novel. It's been going on for decades, for generations. You know I come from one of the finest winemaking areas in all the world, down in the Niagara region. It's an industry that's growing dramatically, even over the course of the last five or six years.

In terms of appreciating that this is a regulatory regime, I've got to confess - and we have several brew-your-own beer and wine down in the Welland-Thorold-Pelham area - that I've never personally been involved in brewing up a batch at one of these locations. I've visited their locations. There's some incredible investment in these places. There's some substantial investment in the equipment that's necessary to make one of these places effectively. That's first of all.

Second, as you know, this industry mushroomed and grew, and one of the problems that occurred was that, as happens so often with a successful industry, it proliferated at such a high rate that the market couldn't sustain all of the operators in the business. Over the course of the last three or four years, sadly, we've seen some of those small business operators fall by the wayside. There simply wasn't enough demand to sustain all of the suppliers of you-brew, brew-your-own facilities.

Things certainly have changed. I remember when I was a kid, in the fall of the year -

Mr Tom Froese (St Catharines-Brock): You can remember that far back?

Hon Jim Flaherty (Minister of Labour): It was before the war.

Mr Kormos: It was some time ago - that pungent and very distinctive odour of mash as it was put out curbside by so many of my neighbours. It was long ago when I was a kid. I remember Charlie - I had a beagle. I don't know if you recall me talking about him, but Charlie got into some mash that was laid out curbside. I don't think he remembered the scenario, but he'd never forget the aftermath. You couldn't get him near the stuff again.

Frank Rao lives just down the road from me. Frank has made as fine a bottle of wine as you'll ever find. Some of the other members have talked about the traditions that people have brought to Ontario, to Niagara region, from their homeland. I remember one year John Trufal made some raspberry wine down on Harriet Street that, I tell you, was out of this world. I was very honoured. He's either taken me off the list of beneficiaries of his winemaking or he hasn't made it again. I would certainly appreciate the opportunity to taste that one more time, to refresh my memory of what was some fine raspberry wine.

From time to time the brew-your-own down in Niagara extended beyond - what else do you do with a bad batch of wine but go down to the hardware store, buy 15 feet of three-eighths-inch soft-wall copper tubing and do your best with it? I've seen a couple of those setups from time to time. I suppose I was fortunate. We didn't use any - "we?" I'm sorry, the ones I observed didn't use any high-tech testing equipment, the sort of stuff that's available to consumers in you-brews. I think you know exactly the process. You put it in a spoon and lit it, and the brighter and bluer the flame, the purer your product was. As I said, what else do you do with a bad batch of wine?

There's some economic theory applicable here. It's called value-added production. You create value out of a commodity that would have had a lesser value were it not for the labour input.

1940

I'm glad we've got the Minister of Consumer and Commercial Relations here because there are a couple of things very much related to this whole process. You're familiar with what's going on in Niagara: an incredible growth in small wineries. You drive along Highway 8 - and it's not just restricted to Highway 8 - Beamsville, Vineland, into St Catharines, and it seems that every month there's yet another new winery. They're very small wineries. You know what I'm talking about. As often as not, they're not growing their own grapes. They're all doing quite well in what is an increasingly competitive market. That's why I'm glad the minister is here.

One that I'm most familiar with is Henry of Pelham.

Interjection: In Pelham?

Mr Kormos: In Pelham, of course, and it's owned by Henry. One of the problems these people have, I'm going to be quite candid with you, is the phenomenon of Sunday openings of LCBOs. It's a legitimate problem. It's detracted significantly from their on-site sales. I think they've mentioned that to you at least a couple of times. They understand you can't roll back the clock. I was never an advocate or a fan of Sunday shopping. I recall there were some members of other political parties who were long-time opponents of Sunday shopping. I understand it's irreversible at this point. It's going to be very, very difficult to roll back the clock.

At the same time, though, talk to some of the small corner store operators; not the chains, not the Becker types of stores that are owned by the big companies, but talk to my friend Sang Anh - I've told you about him before - over at the corner of West Main and Denistoun, with Denistoun Variety. Here's a young man with a young wife. These folks work easily 18 hours a day, literally seven days a week, running that corner store, working like dogs. Arnold Dubé is another one over on Aqueduct Street. Now, because of Sunday openings, they find their revenues significantly reduced.

The same thing has been happening with respect to on-site sales at these small wineries located across Niagara region. LCBOs are open now on Sunday. People aren't accessing - that used to be one of the attractions. Mr Froese knows about it and I'm sure he would speak to it. He'll have the opportunity to speak to the issue when I've completed in a few short minutes. Mr Froese knows exactly what I'm talking about. It was the Sunday access. You had to be small, as often as not family-run, wineries with on-site sales that generated a significant amount of the revenue. They've been seriously negatively impacted, they tell me. If they're wrong and I'm wrong in telling you that, then I hope the minister will say so, but they've been significantly impacted by Sunday shopping in LCBO outlets.

I'm going to talk a little more about some of these small wineries and the relationship of their success and vitality side by side with the phenomenon of you-brews. In some respects it's part and parcel of the same industry and in so many other respects they are two very, very different kinds of things.

One of the things I wish the minister would focus some attention on - and he knows what I'm talking about and so do you - is that nothing rots my socks more than to get on an Air Canada flight that originates in Ontario and with the meal you get a small bottle of some very bad French wine. It's something people should be far angrier about than I've sensed people to be.

Mr Pouliot: It must have been a very bad wine.

Mr Kormos: Every time I've been on a Canadian Airlines or Air Canada flight originating in Ontario and they do the French wine - and as I say, it's bad French wine; it's cheap French wine; it's not very good French wine at all; it's not very good wine, I don't care where it's from - I've made a point of asking the steward or stewardess, or flight attendant I suppose is the proper name, and explaining to them. Some of them now, if I'm on this particular flight, say, "Please, please," and I say, "I understand it's not your decision to do this."

The wineries should be mad. I've talked to them. One told me once that they were instructed to tell consumers who complained about not having Ontario wines that the Ontario wineries don't have sufficient capacity to provide the airlines. What a crock. That was the line they were told to use. I legitimately prevail upon the minister here to use his status, his prestige in the province, his fame - the fact is he's a household word. The Minister of Consumer and Commercial Relations could use that stature to prevail upon - and I say this is in all seriousness - those same airlines. You can bet your boots that Air France ain't serving Ontario wine when it departs from Paris. You can count on it. It does not happen.

First of all, the wine industry told us that in terms of capacity, trust me, they can provide flights originating in Ontario with Ontario wine. That's number one. That's something that some of these small wineries have talked to me very specifically about. I know Mr Froese has been approached in the very same way and I know he'll speak to that in a few minutes when I yield the floor to him.

One of the other problems we've got is that some of these wineries feel hard done by by the LCBO. I understand the LCBO and its effort to approach things in what they perceive as a businesslike manner. But, by God, it is the Liquor Control Board of Ontario and I'm advised by some of these small wineries, some of these small winemakers, that because of some of the recent marketing practices, approaches if you will, of the LCBO, they've had a measurable drop in sales of Ontario wines.

I again would ask the minister to very seriously consider asking for a review of the status given Ontario wines. Look, I've got a preference. I understand wines come from the Pelee Island area - they do - but I've got a preference, I've got to tell you, for wines from Niagara. I think you'll understand why I say that: among other things, ice wine and the incredible impact that's had internationally, and the growth of small family-run wineries and of course the corresponding industry of growing grapes and supplying grapes.

I submit to you, Minister, that there are some problems that should be addressed, that can be addressed on the part of LCBO and how they're marketing Ontario wines and the fact that Ontario wines may not be getting the profile they should be getting in our LCBO outlets.

One of the problems - and I was very surprised to find out about this - is the business of off-site sales. I hope I'm using the right language, and I know Mr Froese will speak to it and correct me if I'm wrong when he has a chance to speak after I'm finished, because we're rotating and he'll have an opportunity to address this bill in a few short minutes.

But I believe it's what we call the off-site sales. That's where you set up a kiosk in a grocery store. Minister, please, if I've received less-than-accurate information - and I don't think I have. I think I've have had it explained to me very specifically and very accurately. The licences for those off-site sales, if you know what I mean, the ones in the supermarkets, for instance, have sort of the scarcity about them of Metro Toronto cab licences - literally. There's X number and the licences that are owned are not always being used by the owner of them, to wit, a particular wine manufacturer. That has basically squeezed out the little players from ever getting involved in this off-site sales, those direct sales to consumers off-site.

That strikes me that doesn't in any way, shape or form assist this growing industry in Niagara and other parts of the province from acquiring the stature it deserves. You know, and the winemaking industry in this province has been speaking with you and your staff, about the whole business of direct selling of wines and the fact that at the end of the day the LCBO takes its rake whether or not it even sees the bottle of wine. I'm not just talking about the taxes here. I'm talking about the markup by LCBO. I appreciate, and so do the wineries, that you can't have a scenario where LCBO no longer has the role that it should have in terms of distribution and marketing of liquor products, but there are also some pretty specific scenarios in which you can envision a small winery especially doing a direct sale and direct delivery of its product. For it to be paying the same markup, for the LCBO to be taking the same rake-off as they do on that bottle they put on the shelf, stored, paid for the cost of maintaining it as a product - I mean it simply isn't there.

1950

I've got to agree with the small wineries that I've spoken to about the unfairness of that position they're put in that prohibits them from engaging in direct sales. Those are the things, quite frankly, that I wanted to raise.

I've got to tell you, the fact that this legislation is endorsed by the Brew on Premise Association of Ontario, albeit representing only, I'm told, 60% of brew-on-premises, the fact that it's supported by that industry goes a long way in suggesting to me and my colleagues in the NDP that this legislation, brief and modest as it is, deserves support.

One of the problems that's contemplated or anticipated, though, is the prospect of using the licensing and fees being charged along with the licensing as yet, dare I say it, another tax grab.

Mr Bradley: Is a fee a tax?

Mr Garry J. Guzzo (Ottawa-Rideau): It'll never happen.

Mr Kormos: The judge from Ottawa says it'll never happen. If you were the Minister of Revenue or the Treasurer, I suspect that it may not happen because you sometimes march to the beat of your own drummer. I've seen it in writing. But the fact is you're not, and this government has a long history now of imposing user fees under the guise of licensing fees and other fees for getting certificates or processing. Look what happened in a recent court case, a fascinating decision about probate fees.

Mr Guzzo: What government was that?

Mr Kormos: I don't care what government does it; the fact is that it's wrong regardless of what kind of government does it. The fact is that these are the guys in government now and these are the guys who have been jacking up so-called user fees when in fact they're - you know that this bill talks about licensing and there are going to be fees concurrent with the licensing. This government has had its knuckles wrapped in terms of using what it calls probate fees as, in effect, a tax, fees merely passed by regulation now.

You should also be interested in what's happened with respect to a whole lot of the fee-generating powers under Bill 25, and we're going to be debating that, I'm told, tomorrow night. This talks about licensing; concurrent with licensing is the prospect of fees. Again, the you-brew industry itself is not opposed fundamentally to licensing. Their lobby group, the Brew on Premise Association of Ontario, some 60% of the operators, supports this bill, but has expressed very specifically concerns about increased taxation and about using licensing fees as a cash grab.

We saw it in estimates. As a matter of fact, one of the ministries that was most culpable was the Ministry of Consumer and Commercial Relations. They gutted the ministry, jacked up fees and showed themselves to be running at usurious new profits. Minister of Consumer and Commercial, you remember, and Mr Bradley remembers. We were in estimates. We very carefully took area by area because that's when they created self-regulation, so they passed on the regulatory responsibility but maintained the fee-collecting power. They kept raking in the dough, but wouldn't accept any responsibility for policing, for instance, the regulations that were being imposed in any given number of sectors of any number of industries that were traditionally supervised by the Ministry of Consumer and Commercial Relations.

There may well be individual operators, for instance, those who either don't subscribe to the view expressed by the Brew on Premise Association of Ontario or those who are members but who don't necessarily agree or who are individual operators who prefer not to belong to that association. I think it's important to hear from these people if indeed they indicate a desire to be heard and to let them have their say in response to this legislation.

You understand that this of course is going to be administered by the Alcohol and Gaming Commission of Ontario. Am I correct about that?

Mr Bradley: I think they do.

Mr Kormos: I don't want to digress. I don't want to get off topic. I couldn't talk about the Alcohol and Gaming Commission if it weren't relevant to the bill, but I think it is relevant because this regulation is going to be enforced by the Alcohol and Gaming Commission of Ontario.

Let me share with you my concerns. This government merged the two bodies. Look, there's nobody in the community who doesn't want to see standards maintained in you-brew premises, be it for beer or wine; who doesn't want to ensure - what's the language - that there's a level playing field for all the players, all the operators; who doesn't want to ensure that people abusing or - you know what we're talking about. We're talking about you-brews that are in effect bootleg operations. Is it fair to put it that way? Is it fair to be that blunt, that bold? There's a fear that some you-brews are in effect bootleg operations. The ones playing by the rules are saying that that puts them at an unfair advantage.

We've got legislation here that, for instance, controls the ability of people under the age of 19 to use the premises to brew their own, if you will - but all supervised by the Alcohol and Gaming Commission of Ontario. That's where I've got to express some concerns; not about the commission per se but about how candid this government has been when it has come to issues that very much involve the Alcohol and Gaming Commission.

Earlier today you heard this Legislature reminded, you heard the government reminded, you heard the Chair of Management Board being reminded that back when we were talking about Bill 75 and video slots, VLTs - Alcohol and Gaming Commission of Ontario - we knew there was a major OPP paper and analysis that dealt with organized crime and the gaming industry and - this is where it becomes very relevant now to Bill 57. As a matter of fact, what's interesting is that Bill 57 is Bill 75 with the numbers just reversed. I think I'm getting very on point now: Bill 75, Bill 57, you just reverse the numbers.

You heard us earlier today express great concern about the fact that there was a major OPP report about the role of organized crime in gambling and the capacity that organized crime had to infiltrate the new gambling schemes being created by this government very specifically pursuant to Bill 75. You heard how we petitioned and prevailed upon the government during the course of those committee hearings to produce that report. The government stonewalled; the government blocked the release of that report. I've read most of that report since then because most of it has eventually been leaked out.

We now discover that in 1996, for instance, during the period of time when that same justice committee was debating, or trying to deal with and respond to the issue of video slots and the gross expansion of gambling by this government - gaming, which one would assume would be supervised by the gaming commission or in some respect supervised by the gaming commission, the very same commission that's going to be supervising this amendment to the Liquor Licence Act - we find out that there was a very comprehensive legal opinion prepared at the request of the Ontario Lottery Corp which basically said that gaming - for the first time that we're aware of such a report being prepared. Please, I want to make that perfectly clear. It was only in 1996 that a comprehensive legal opinion was prepared suggesting that the nature of gaming, casino gambling and especially the proliferation of video slots were a violation of the Criminal Code of Canada. The government concealed that report.

2000

Mr Froese: No.

Mr Kormos: The government did. I know that we're talking about Bill 57 and I know we're talking about you-brews and the regulation of you-brews, and we're talking about the supervision of that regulation being performed by the Alcohol and Gaming Commission of Ontario. I'm just expressing some concern here.

In this scenario, am I concerned that the government has been less than forthright? I've got to tell you there's no reason for me to suspect the government's not having been forthright but for the fact that they've been so lacking in candour in the past. A legal opinion prepared at the request of the Ontario Lottery Corp saying this government's gambling scheme is a violation of the Criminal Code of Canada and the government sat on it, wouldn't share it with members of the justice committee, and suggesting that there could well be charges laid in due course - I don't know who would be charged. There would be all sorts of arguments made about immunity, maybe about the fact that - the Premier isn't a head of state, so we can't do the Pinochet argument. The fact is that he's directly responsible at the end of the day.

The Acting Speaker: Be careful. That's not very complimentary and I would not accept that at all.

Interjection.

The Acting Speaker: No, no. I think the member for Welland-Thorold understands me very clearly. Please withdraw that.

Mr Kormos: I withdraw that. That was entirely inappropriate, Speaker. The comparison of the two was not appropriate and I appreciate your direction in that.

With the case of Mike Harris's government, we're talking about merely violating the Criminal Code of Canada and expanding prima facie illegal gaming activities. It makes Bugsy Siegel look like a law-abiding citizen. A little closer to home now, huh?

In any event, I've got great concerns about this government's inability -

Hon Mr Flaherty: On a point of order, Mr Speaker: The member opposite indicating that he viewed the Premier as violating the Criminal Code of Canada seemed inappropriate.

The Acting Speaker: Take your seat, please. If you'd paid attention to what I said, I corrected him. I didn't accept that. I asked him to apologize. I don't accept that kind of comparison. It's totally inappropriate, and as long as I'm in the chair I won't accept it. He apologized. You should have paid attention.

Hon Mr Flaherty: I was, Speaker, and his comment with respect to the Criminal Code, with respect, was made after your intervention.

The Acting Speaker: Member for Welland-Thorold.

Mr Kormos: I'm not going to rehash old ground. I'm just stating that there's no head-of-state defence available to the Premier when he's been very directly involved in the promotion of a comprehensive report prepared by a major law firm, retained by the Ontario Lottery Corp, which says that this government's expansion of casino and maintenance of its casino operations and gambling operations appear to be in violation of the Criminal Code of Canada. I read the report. It was an opinion expressed by lawyers who were retained by the Ontario Lottery Corp. The problem is that we should have had that report when we were debating Bill 75 back in 1996. The government sat on it. The government hid it away.

I leave you with that, Speaker. I reassert our support for Bill 57 and I assure you we're going to be revisiting this government's hiding away and blocking of public release of very important documents like the OPP crime report and the legal opinion indicating that the government's casino scheme is contrary to the Criminal Code of Canada. We're going to be pursuing those with vigour.

The Acting Speaker: Questions or comments? Further debate?

Mr Bradley: I'm going to be wrapping up for the official opposition in terms of the third reading of this bill this evening and to offer a few remarks about it.

I'm looking forward to your remarks, and other colleagues in the House, on the occasion of Remembrance Day. Ordinarily, the last week before we experience and mark Remembrance Day, we have representatives of each of the three political parties in the House together express their views about the individuals who have given their lives and served on behalf of the country. This gentleman who is in the chair at this time, M. Morin, has been the spokesperson for the Liberal Party for some time. I enjoy his remarks and the remarks of the others, so I'll be looking forward to that.

What I find somewhat amusing this evening and worthy of remark is the fact that we have the Mike Harris Conserve-a-Tory government passing legislation which establishes a new regulatory regime in a specific area. I thought this government was all about removing regulations and thought that regulations were some evil instrument used by previous governments. Tonight we are going to pass legislation which in effect establishes new regulation.

I'll have to report this to the red tape commissioner, the chair of the Red Tape Commission, my good friend from Lincoln, who on so many occasions has mentioned how wise it is of the government to remove regulation. I'll have to let him know that this bill establishes regulation and establishes an opportunity for the government to collect further taxes, because of course our Premier, Mike Harris, said that a user fee is in fact a tax. While this legislation is contrary to the Red Tape Commission and its main thrust, I trust that all the government members will still be voting for it.

The quality of wines in Ontario has been mentioned by my colleague from the Niagara Peninsula and by others. I think all of us in this House now recognize that the quality of Ontario wines has done nothing but improve over the years. It used to be that years ago, a couple of decades ago, people would make disparaging remarks about our wines and the defence was pretty weak in terms of those of us in Ontario who would stand up for and state the high quality of our wines. Today, of course, we rank among the best in the world. I suggested back then there were some very good wines, but they simply weren't recognized. Today we have developed a number of new wines that are of the highest quality, particularly those wines which are designated as Vintners Quality Alliance wines - VQA, as we call them. This is an effort on behalf of those who operate our wineries to ensure that we have for those who want to consume wines a very high-quality product. That is why we have the VQA appellation.

I would like to see this government, or any subsequent government, pass legislation which would give official recognition in law in Ontario to the VQA appellation or designation. One of the arguments that people in Europe, particularly the French in France, use against us is that we don't have this kind of authority in law to call our wines Vintners Quality Alliance wines, that we don't have government backing. I suggest that it is there, it simply isn't there in legislation, and that is a piece of legislation which I'm sure would receive unanimous and speedy passage through this House. I would hope the government would move, after this legislation, in that direction.

I am pleased that the Liquor Control Board of Ontario has been saved from the clutches of those who wish to privatize anything that moves in this province. The minister of privatization, who has privatized three tree nurseries now, is well on his way, earlier today privatizing a highway, turning the keys over to the private operators of this highway so that they can make millions of dollars charging tolls and own something that will be utilized by some people in this province.

But we have saved the LCBO. I suspect it's the petitions that some of us read in the House on a daily basis that turned the tide. The Speaker who is in the chair would know that is probably the case, because he listens carefully to the petitions. I'm sure he would recognize that they turned the tide and forced the government to reconsider its earlier plan to turn the Liquor Control Board of Ontario stores over to its friends in the private sector who were looking forward to making outstanding profits on them. The reason I say that is that the LCBO is one vehicle which we have to promote our Ontario wines in an appropriate fashion.

2010

As someone mentioned earlier this evening, it is unlikely that in France they are featuring Canadian wines on the shelves of their stores. In fact, it is often difficult to penetrate the market in many other countries because of these non-tariff and semi-tariff barriers that they have; in other words, trade impediments that they put in front of Ontario wine.

I'm pleased to see that those of us who wanted to save the LCBO as an instrument of the government of Ontario and as a controlling agency, controlling the quality of the product and the distribution of the product, have been successful. If not the petitions in the House and the questions in the House, it may well have been the speech I delivered to the employees of the Liquor Control Board of Ontario at their annual convention that turned the tide. I know that the Minister of Consumer and Commercial Relations was obviously listening to that particular intervention on my part and I want to compliment him on accepting that good advice.

Placement, by the way, on LCBO shelves is important. If the LCBO in any area features wines other than Ontario wines in a very decorative and appealing way, it certainly gives a leg up, if you will, to the wines from other countries. I would always hope that we would have a fine featuring in all LCBO stores in Ontario of our particular wines, which are of the highest quality.

Another member from Niagara made reference to the Air Canada circumstances. It used to be that if you went on Air Canada or perhaps even Canadian Airlines and asked for a Canadian wine, the steward looked at you as if you'd asked for turpentine. That meant the wine steward was very uninformed and didn't know of the high quality of Canadian wines. Today there is some penetration into that circumstance; not enough, in my view, but there is the penetration and people are now enjoying Ontario and other Canadian wines as a result.

The offshore competition we face is unfair, in my view. I think most of us in the peninsula would agree with that. You have under-the-table subsidies, you have subsidies that aren't under the table, you have promotion of their products to the great exclusion of products from other places, and they have other ways of preventing us, as Canadians, from penetrating their markets. Therefore, I think we're quite justified in Ontario in doing as we do when we promote our product. We're very good to foreigners in Ontario in terms of foreign wine producers. We transport them and we put them on the shelf, we stock them, we carry out a lot of things which are beneficial to foreign wines. Surely, we should not feel reluctant at all to make sure that our wines are featured well on the LCBO shelves.

Sunday openings were beneficial to our wineries. I'm not particularly happy about the Sunday openings of the LCBO because I think they have hurt our individual wineries. There is a difference. You can remember when you had a "tourist" designation. If you had a type of business that appealed to tourists who might come in to buy apples or peaches or pears or something like that or our wines, a lot of that involved tourists coming from the United States or from the Metropolitan Toronto area, the greater Toronto area, to visit our wineries on a Sunday, to go out for a Sunday drive. Having them opened, as the Peterson government permitted in the late 1980s, was somewhat beneficial, as was the use of credit cards. There was a time not that long ago that you could not use a credit card at one of our cottage wineries. So you'd go into Niagara-on-the-Lake or you'd go west of St Catharines, into the Beamsville and Grimsby area and so on, any one of these areas, southwestern Ontario, and you couldn't use a credit card. A lot of Americans or people from afar would come over with credit cards wanting to purchase some quantity of wine at that local winery, didn't necessarily have the cash, and couldn't buy it because credit cards weren't used. The Peterson government permitted that to happen and we were pleased to do so.

There was also a substantial investment by government in the very late 1980s in the wine industry, in the grape-growing industry. A lot of people forget that. A lot of people forget that it took some government investment, some investment on the part of the taxpayers, to help turn around this industry. The vogue today is to not have government provide any of what people would call handouts or investment in what is considered to be the private sector. I'm going to tell you that the assistance provided by the government of Ontario in that time saved us, particularly as we were facing free trade pressures and ultimately NAFTA pressures and international pressures, that is, the general agreement on tariffs and trade, GATT. With all the pressure and all the competition and the desire to change the kind of grapes we were growing, it required a significant government investment in our wine industry. Without that investment, it's unlikely we'd be enjoying the kind of progress and success we see today.

Also, there are many entrepreneurs out there, farmers and winemakers, who have worked extremely hard to produce high-quality grapes and ultimately high-quality wine and grape products, and we have been successful for that reason. It's a success story about which much should be said, and we're certainly delighted about it in the Niagara Peninsula.

I want to say as well, as I did the other day, that direct delivery to restaurants would be the next move that would be beneficial. Mr Speaker, what you should understand is that now, if we wish to have Niagara wines delivered to a restaurant in Etobicoke, for instance in the new riding of Etobicoke Centre, where you are contesting the Conservative nomination against Mr Ford - I know you want me to be fair and to say that. I know you are contesting the nomination in Etobicoke Centre.

The Speaker (Hon Chris Stockwell): On November 23.

Mr Bradley: On November 23.

If we were to deliver the wines to a store there, the LCBO gets a markup, a take. Mike Harris gets his hands on something close to $10; a big chunk of money comes to the government of Ontario. What our grape growers are saying, what our wineries are saying, particularly the smaller cottage wineries, is, "Let us deliver, but don't charge us for that delivery." They want direct delivery to the restaurants. I certainly support that. That is something I hope to see in the next provincial budget. As I indicated the other night in this House, I'll lead the applause when that's announced by the Treasurer. I'm sure it will be on the government members' - what is it they put down? They must put the budget speech down and they have a place where they're supposed to applaud. The member for Nepean usually leads the applause and then others join in the applause.

Mr Froese: But you'll lead that one.

Mr Bradley: I will lead that. My friend Tom Froese says I will lead it, and he is right. If that is contained in the budget, I'll be the first to applaud the Treasurer for having listened to my suggestion that he allow direct sales to the restaurants by the wineries.

I'm worried as well at the cut in the LLBO staff, because if you have a cut in that staff they may not be able to supervise the provisions of this bill in appropriate fashion. I look around at the Ministry of Consumer and Commercial Relations and I worry about the cuts to staff that have taken place since 1995, because I want my friend the minister to have the appropriate staff and resources to carry out his responsibilities. He's had to, in so many areas, put the fox in charge of the henhouse. So there's not government supervising in this case but the person in that business supervising that business. That works sometimes, but I've often thought it's fair and impartial to have the government looking at that so it's fair and impartial to all in the business.

I worry, for instance, when I see that there's not enough staff to deal with these scams going on. Much as we try hard, the telephone scams and the mail scams go through, where something says you've just won $11 million. Everybody on your street's probably won $11 million; all you have to do is fulfill the conditions, which are in print you need a magnifying glass to read, and it usually costs you some money. I'm hoping that the minister will have appropriate staff to be able to tackle those kinds of problems.

I remember once somebody tried to sell some kind of ink to my office, some firm in Toronto that worked out of a small - I wouldn't even call it an office - warehouse in Toronto. They phoned and made like they were from Xerox and said, "We're going to have a 40% cut, but you have to buy it by Tuesday" or something. They made it sound very legitimate. I had to storm down there -

Mr Froese: Because it was cheap, eh?

Mr Bradley: Well, it's the taxpayers' money.

I had to storm down there, with other people, of course, because somebody said: "You've got to watch out for those folks. Sometimes they're trouble." I had to bring it back and plunk it down on the desk. The person accepted that in this particular case, but I know a lot of people who were stuck, left out in the cold by this. I know that the Minister of Consumer and Commercial Relations and the OPP would want to be aware of that kind of operation going on.

I want to say as well that if we're going to have good grapes, we've got to have good land available. I am perturbed when I see the continuous development of prime agricultural land in the Niagara Peninsula, for two reasons: In many locations we have very good soil conditions, and all over the Niagara Peninsula below the escarpment we have favourable climatic conditions for the growing of tender fruit. When I see developers buying up land right adjacent to the city urban boundaries in any area, particularly the agricultural land, and leaving it to lie there and not farm it and then come to a city council or a town council and saying, "Nobody's farming it, so we may as well develop it," I become very perturbed.

What attracts many people to the Niagara Peninsula from the United States and particularly from the greater Toronto area are the large tracts of agricultural land. To keep the farmers on the land, we have to make it viable. We have to see that the appropriate prices are paid for our food or that other assistance is provided to them indirectly, if we're not prepared to pay that price on food. I'm prepared to see that happen. But I think these continuous applications for severances are unhealthy as urban people move out to the country and then complain about the country odours and the noise and the dust and so on.

I hope our municipal councils around the Niagara Peninsula are wise enough not to pave over every last centimetre of agricultural land until we have one big mass from Metropolitan Toronto to Fort Erie and then nothing else left for agriculture. The soil is good and the climatic conditions are good, and I want to see my friend Tom Froese being able, as he so ably does, to farm his property for many years to come and produce the kind of product that all of us want to see, and other farmers in the Niagara Peninsula.

It's the last minute of play, so to speak, in my speech. I am concerned, of course, about the Hotel Dieu Hospital closing, but that's not part of this bill. The only way it is, is that many of the people who buy some of the product that is found in our wineries are also some of the people who support Hotel Dieu Hospital in St Catharines staying as it is, continuing to provide service to the people of our community for many years to come. None of us wants to see the Hotel Dieu closed, I'm sure. I know all the Niagara Peninsula members will be writing to the commission asking that the Hotel Dieu not be closed, that the boots not be put to the Religious Hospitallers of St Joseph, the nuns who have served so well over the years, and that that particular hospital be allowed to continue to provide outstanding medical service to all in the Niagara region.

The Speaker: Questions and comments?

Mr Tsubouchi has moved third reading of Bill 57. Is it the pleasure of the House that the motion carry? Carried.

Resolved that the bill do now pass and be entitled as in the motion.

Hon Mr Tsubouchi: Mr Speaker, I move adjournment of the House.

The Speaker: Is it the pleasure of the House that the motion carry? Carried. This House stands adjourned until 1:30 of the clock tomorrow.

The House adjourned at 2025.