Intended
appointments
Mr Frank Potter
Ms Diane Beattie
Ms Mary Mogford
Mr Donald Weiss
Mr Peter Minogue
Ms Shehnaz Alidina
STANDING COMMITTEE ON
GOVERNMENT AGENCIES
Chair /
Président
Mr James J. Bradley (St Catharines L)
Vice-Chair / Vice-Président
Mr Bruce Crozier (Essex L)
Mr James J. Bradley (St Catharines L)
Mr Bruce Crozier (Essex L)
Mrs Leona Dombrowsky (Hastings-Frontenac-Lennox and Addington
L)
Mr Bert Johnson (Perth-Middlesex PC)
Mr Morley Kells (Etobicoke-Lakeshore PC)
Mr Tony Martin (Sault Ste Marie ND)
Mr Joseph Spina (Brampton Centre / -Centre PC)
Mr Bob Wood (London West / -Ouest PC)
Substitutions / Membres remplaçants
Ms Marilyn Churley (Broadview-Greenwood ND)
Mr Gerry Martiniuk (Cambridge PC)
Mr Gerry Phillips (Scarborough-Agincourt L)
Mr David Young (Willowdale PC)
Clerk / Greffier
Mr Douglas Arnott
Staff / Personnel
Mr David Pond, research officer, Research and Information
Services
The committee met at 1006 in committee room
1.
SUBCOMMITTEE REPORTS
The Chair (Mr James J.
Bradley): Good morning, ladies and gentlemen. For the
purposes of Hansard, this meeting is now called to order. We
should have people here today responsible for the Queen Elizabeth
Way and the traffic on it. However, we do not.
Mr Joseph Spina
(Brampton Centre): From St Catharines.
The Chair:
That's right.
The first item we have is a
report of the subcommittee on committee business dated Thursday,
March 9, 2000. It's attached in your information. I need a motion
to approve the subcommittee report. Moved by Mr Johnson.
All in favour? Opposed?
Carried.
The second is a report of the
subcommittee on committee business dated Thursday, March 16,
2000.
Before we pass this
particular motion, we have received word from one of the intended
appointees that he will be unable to be with us. Mr Royal Poulin,
the Ontario Northland Transportation Commission, will be unable
to be with us on the date that will be prescribed. Mr Johnson has
indicated to me that it is acceptable to him, as the whip for the
government on this committee at this time, to extend for 30 days
the opportunity to interview Mr Poulin. If that is acceptable to
all three parties, we will do so. Is that acceptable?
Mr Bert Johnson
(Perth-Middlesex): I would suggest, Mr Chair, that that
should be an amendment to the report, and then we'd accept the
report.
The Chair: I
think that's a good idea, if you would make that amendment, Mr
Johnson.
Mr Johnson:
I will.
The Chair:
Thank you kindly. Any objection to that?
All in favour of the report?
Opposed? Carried. So the report is carried, as amended.
INTENDED APPOINTMENTS
FRANK POTTER
Review of intended
appointment, selected by official opposition party: Frank Potter,
intended appointee as vice-chair, Ontario SuperBuild Corp board
of directors.
The Chair:
The appointments review begins at 10 am, and we can see it's a
little past there.
Our first intended appointee
this morning is Mr Frank Potter, an intended appointee as
vice-chair of the Ontario SuperBuild Corp board of directors. Mr
Potter, you may come forward, please, if you would. This was a
selection of the official opposition party. Would you like to
make an opening statement or opening remarks, sir?
Mr Frank
Potter: I would, Chairman. I have a short statement to
read.
Chairman, committee members,
I am appearing before you as the nominee to the vice-chairmanship
of the Ontario SuperBuild Corp. I believe you have a copy of my
curriculum vitae. As you can see, I have spent the bulk of my
career in finance and public service. The majority of my banking
experience has been in international banking, including several
years in a number of countries outside Canada. I also spent
nearly nine years as executive director of the World Bank in
Washington, where I was the senior director on the bank's
executive board and chairman of the bank's steering committee. I
was later an adviser at the Department of Finance, interested
principally in fiscal policy. After leaving finance five years
ago, I became a corporate director and sit on a number of boards
divided more or less evenly between corporate and volunteer
organizations.
My association with
SuperBuild Corp began late last year when I was approached by the
consultant conducting the search for the new CEO. I was not
interested in a full-time position, but I did indicate to the
consultant that the mandate was of considerable interest to me.
It is a field in which the World Bank had done a good deal of the
early work, and one where in my opinion the combination of good
public policy and well-structured private initiative has the
potential to deliver substantial welfare gains.
The possibilities of
mobilizing private capital to serve public purposes are very
real, as we have seen in other jurisdictions, but not easy to do
well. The issues are almost invariably complex, but the
consistent and sometimes dramatic improvements in productivity
and service levels which have been demonstrated so conclusively
elsewhere suggest to me that there is a compelling case for
trying to accomplish the same gains for Ontario.
SuperBuild is just now
beginning to put its work plans in place, and I would expect that
the management will be putting its ideas to the board in due
course. At this early stage, I'm afraid my knowledge of the
agency's activities and
objectives present and future is therefore not very developed.
However, I'll be more than happy to try to answer any questions
which you may have about my background and qualifications.
The Chair:
Thank you very much, sir. We'll start with the official
opposition. Mr Phillips.
Mr Gerry Phillips
(Scarborough-Agincourt): It is an impressive background,
and I appreciate your letting your name stand.
The 407 is the first example
the government uses of a good public-private sector partnership.
In my view, it's a bad example, and perhaps I can get your view
on it.
The government essentially
sold it for twice what it cost to build, which may sound fine
except that it will be the users, the taxpayers, the people who
wanted the 407, who will pay for the fact that the government
built the road for $1.5 billion and sold it for $3.1 billion.
What it will mean is the tolls are essentially twice what they
need to be, because obviously the consortium wants a reasonable
return on investment. They've invested $1.6 billion more than it
cost. The government guaranteed that they could take the tolls up
without limit. If you didn't pay the tolls, you didn't get your
licence renewed. They sold it for 99 years, which was beyond any
advice I think they got.
I want to take advantage of
your experience now on the SuperBuild Corp. As I say, the
government's first example is the 407. I think it was a great
deal for the private sector. It was a good deal for the Harris
government; they closed it the day the election was called. But
for the people we are trying to serve-that is, the people who
wanted the road-they are going to pay forever, at least for 99
years, twice the tolls they would have had to pay.
I'm wondering, with your
experience both elsewhere and now on the board, how you view that
407 deal. Would you have done it the way they did it, or do you
have some advice as to how it could be done differently in the
future?
Mr Potter:
I'm not going to try and duck the question, but the truth is I
don't know much about 407. It's always possible to do things well
or badly, but I'm not sure it should detract from a pragmatic
examination of the case for something like 407. My attitude
toward the case would be an open attitude and a pragmatic
attitude.
I would have to assume that
there is some limit to the capacity of any government to raise
funds and deploy resources in whatever sector it may be: health,
education, child care, who knows? To the extent that it can
harness resources, that it can mobilize private resources and
produce facilities which have the potential to contribute to a
public good, it seems to me to be worth trying.
If the numbers in 407 are not
satisfactory for some reason-and that's entirely possible-I'm
afraid I'm not familiar with them.
Mr Phillips:
One issue for all the directors I think is conflict of interest
between their other activities and their interest on the
SuperBuild. One of the challenges of this board will be that it's
going to have responsibility for $20 billion worth of investment.
It's the funnel through which everything will flow in capital
investments. One of my concerns with taking it away from the
bureaucracy and putting it in the hands of an advisory group is
the potential for conflict down the road.
Have you had a chance-well,
obviously you have because you've accepted the position-to
determine whether there is the potential for conflict and how you
would plan to handle that? I notice you're a director of
Teranet.
Mr Potter: I
was a director; I'm no longer a director.
Mr Phillips:
Oh, you're no longer a director. So you have no conflicts, then,
with people who-
Mr Potter:
No. I can imagine areas in which I would have a
less-than-objective interest, in which case I would have to
declare those and recuse myself. I'm the chairman of the ROM
Foundation. The ROM has some ambitions to improve its facilities
and I'm very confident that at the end of the day there's going
to be a covetous eye cast towards SuperBuild. Public institutions
of that kind will look to SuperBuild for support, and if the ROM
appears on the SuperBuild agenda, then I obviously won't be able
to participate and I'll have to declare a conflict.
Mr Phillips:
But you wouldn't have any conflicts in the private sector?
Mr Potter: I
beg your pardon?
Mr Phillips:
None of your private sector ones? You're no longer a director of
Teranet.
Mr Potter: I
can't foresee something like a life insurance company or a
retailer falling into conflict, but if it were to happen I think
standards of good governance, whether it's SuperBuild or anywhere
else, declare participants to declare conflicts. I would do that,
although this is an advisory board. To the extent that we offer
opinions, we're not making decisions; that prerogative remains
with the cabinet and with the government, with the mechanisms of
elected officials. I would have thought the prospects for
conflict are relatively minimal.
Mr Phillips:
I assume that was something that was covered in the screening of
any directors coming on to the board.
Mr Potter:
Which was?
Mr Phillips:
Conflict was something that was covered with each director
before-
Mr Potter:
Do you mean that it was discussed? Well, it was made very plain
that this is an advisory board, yes.
Mr Phillips:
With your experience around the globe in private-public sector
partnerships, what would be some of the criteria you would see as
crucial? The reason for my question is that I think the 407 user
was left out to dry on the 407. I don't think they were
considered in the deal. I wonder if you have any advice for us in
terms of the criteria you would be looking at for these private
sector partnerships.
Mr Potter:
The thing I would put at the top of my list is pragmatism. It's
not a subject that lends itself to doctrinaire discussion. It's a
matter of trying to understand needs. It's a matter of taking
tremendous care in defining objectives and articulating standards
with great care so that the inevitable conflicts which arise
between public policy and private investment are catalogued, and
people understand what they are, and that the boundaries are set
and the rules of the road are well articulated.
1020
Mr Phillips:
I'm anxious for you, at the end of my question, to give us some
examples of things you think would be good examples of private
sector partnerships. There are three kinds that I'm aware of. One
is where the private sector are essentially sold a stream of
revenue. That's the 407; they were essentially sold the toll
users. "We're going to have a very congested area north of
Toronto over the next 99 years. We'll sell you the users of the
road," or, for a sewage treatment plant, "We'll sell you the
stream of revenue you can charge for processing that."
The second one is where the
private sector will build something-
Failure of sound
system.
Mr Phillips:
-where the private sector get some commercial benefit, "If you
agree to do this, we'll give you double the coverage on that
piece of land," or something like that.
What would be some good
examples of private sector partnerships that you can envision for
Ontario?
Mr Potter:
I'd be very open-minded, frankly. I'd be wary of not being
willing to examine any area of service where there is hope of
marrying private entrepreneurial management and capital for the
provision of a service. Nothing springs to mind immediately.
I'm not offended by the idea
of a toll route. If the pricing is wrong, presumably there will
be a reflection in utilization. I assume people who are using
that road are willing to pay the tolls, and if that arrangement
has freed up an amount of capital which is available for
investment elsewhere in the province, that seems to me on the
surface to be worth thinking about and looking at and trying to
get right. You can do a bad deal anywhere; it's easy to take good
initiatives and screw them up. But I'm not offended by the idea
that somebody should operate a road and be paid for the
convenience of providing that service if someone is willing to
pay voluntarily.
Mr Phillips:
I'm not either. It's-
The Chair:
Sorry, Mr Phillips. The time is up for your questions. For the
third party, Ms Churley.
Ms Marilyn Churley
(Broadview-Greenwood): Welcome. Thank you for joining us
this morning.
I want to come back briefly
to Highway 407. I recognize that you said you weren't aware of
all of the details of that particular situation, but many of us
and many drivers see it as a disaster for them, the way it
unfolded. So I want to ask you a more specific question about
it-that still, I think, can be fixed. For example, the level of
usage that would trigger a cap on the private company's ability
to raise tolls has been kept secret; it has been kept from the
public. What I want to ask you is, do you think the terms of
contracts between the government and private companies for
infrastructure investment should be made public or, as in this
case, should they be kept secret from the public?
Mr Potter:
Well, I don't know that case, but if you look at the literature
dealing with the field of infrastructure investment in the
private sector, one of the principles which is always evident is
the need for transparency. But the need for transparency can
never be absolute. There are going to be areas in which private,
confidential information is deservedly protected for the
investor. That's just a fact of commercial life. Where the
boundary lies in this case I don't know, but my instinct would be
toward transparency, recognizing that you will never get perfect
transparency.
I'm not aware of the formula
you've described. I can imagine that if traffic falls below a
certain level, then they need recourse to revenue improvements. I
suspect that's what it's about.
Ms Churley:
Yes. I just don't understand, in this situation, why that kind of
information could not be made public. I don't understand why that
would hurt the investor. Do you?
Mr Potter: I
just don't know. My presumption would be in favour of
transparency.
Ms Churley:
So based on the knowledge you have at this point, from what you
said, I could take it that you would prefer to have this kind of
information made public, that you think it should be.
Mr Potter: I
would prefer it, but I wouldn't presume to say there's not a good
reason why it's not in this case. I spent part of my life
financing these kinds of projects, and of course the lenders get
very worried about risks and defining limits to risk and
attempting to put language in place that buttresses the kind of
protection they want. I suspect that that has given rise to
that-lenders in the background worrying about project risks.
Ms Churley:
I suppose so. But as you may be aware, when the NDP government
first negotiated this private-public transaction on Highway 407,
the concept at the time was that there be tolls until the highway
was paid for. Under the Harris government, that was changed, and
even after the highway is paid for people are going to have to
continue paying those tolls. Of course my party thinks that's
really unfair. It's a disaster. That was not the intent of the
public-private partnership at the time. Now people are going to
be asked to pay these tolls indefinitely, and they're going to be
able to raise these tolls without telling the public why. I hope
that if you are appointed, you will take a look at that.
The other thing I want to ask
you about is, do you think that highways that currently exist or
highways that are being built to replace existing highways should
be tolled, or should tolls be ruled out-not brand new highways
particularly, but highways that are being built to replace
existing ones, plus existing?
Mr Potter: I
don't know. I think you are asking that of the wrong person. I
think the job of the crew that is being recruited to this board
is mostly to deal with methodologies-financial methodology. The
application of sensible public policy to all this, what makes
sense in terms of
reflecting the will of the community and so on, is made by other
people, and I think that sort of question lies out there. You
deal with that before we think about how you do it, not whether
you do it.
Ms Churley:
I see. So you see your role as giving mostly financial advice as
opposed to policy advice.
Mr Potter:
Yes, I do.
Ms Churley:
I see. I guess most of my questions were more around policy
questions, because they are of great concern right now, given the
direction the public-private partnership is going. Perhaps I
could ask you, then, about the amount of investment. The
government is putting in $10 billion for the next five years, $2
billion a year. That's much less than even the NDP government put
in, in the last year in office, which I think was about
$3.8 billion. The Tories have averaged $2.7 billion over the
past four years, so it has actually gone down. Given what you
know to date about the possibility of making these kinds of
partnerships, do you think that's enough money?
Mr Potter:
That depends on how much leverage can be applied to mobilize
other resources. The total investment in infrastructure in the
province has clearly lagged. There are yardsticks available. I
have some notion of the numbers, but I wouldn't quote them. But
there are ratios of GDP that represent passable amounts of
investment in public infrastructure. By those yardsticks, I think
we have been falling behind, and so we see a depreciation of the
capital structure in the province. I think most people would
agree with the argument that infrastructure of a high standard
facilitates economic performance.
If we're worried about the
welfare of the community and its ability to produce and compete
and prosper, and therefore have choices to make, infrastructure
is an important part of that. To the extent that there's less
public money, then clearly there has to be more private money. I
believe that's possible, and I believe it brings some salutary
effects to the process as well-not universally salutary but
salutary on balance.
1030
Ms Churley:
I guess, though, you would also agree there is a really delicate,
fine balance here. If there isn't a significant amount of public
investment, the more you have to rely on the private sector,
perhaps that balance is lost and, as in Highway 407, too much is
given to the private sector at the expense of the public. Do you
think there needs to be that kind of balance, and is that
something you could see looking very carefully at in your role,
that the public interest is protected in these kinds of
partnerships?
Mr Potter: I
don't see how anyone involved in this process can be oblivious to
that, because that's the minefield. There is so much suspicion
and reservation about the utility of the process that anyone,
even true believers, should be very sensitive to this.
Ms Churley:
Are you a true believer? You walked into that one.
Mr Potter: I
hope I'm a pragmatist. I hope I'm open-minded about it. I can
think of lots of areas where private investment is not
suitable.
Ms Churley:
You see, that-
The Chair:
Sorry, Ms Churley, the time is up. The government caucus.
Mr Johnson:
I want to welcome Mr Potter. We haven't had the pleasure of
meeting. I want to say I am impressed with the experience you
bring to this position, should you be successful, and I want to
congratulate and thank you for offering to serve your province in
a public way.
I think Mr Young has some
questions.
Mr David Young
(Willowdale): Before I commence my questioning, I want
to reiterate what was just said about the applicant and what Mr
Phillips said so well. It's hard to consider you, Mr Potter,
without being impressed by your credentials and your experience.
On the face of the documentation in front of us, we're truly
fortunate to have someone with your experience, both nationally
and internationally, and I'm certainly pleased about that.
My friends on the other side
of the room have spent a fair bit of time this morning discussing
the 407 and have chosen to ask you certain questions that one
might say are loaded by reason of their view of things. I think,
more importantly, that we would like to hear from you about
international experiences with public-private partnerships, if
you can speak to that. I notice that, with the World Bank, and
with the International Development Association thereunder, I
guess, you likely have considerable experience, and maybe you can
speak to how those endeavours have proceeded, both in terms of
process and the actual results that were achieved.
Mr Potter:
My impression, which I think is probably a general one, is that
there has been a trend in the last decade or so to examine the
boundaries between the role of government and the place of
private capital in the provision of public services. I would say
that on balance the record sustains that agenda. It's been found
that well-designed projects have a capacity to provide services
to the public without incurring the burden of additional revenue
take. The fiscal burden is reduced or eliminated, and there are
methods which serve to harness the ability of the private sector
to manage things and, without wishing to give offence, I think
the general view is that the private sector does tend to manage
commercial enterprises better than governments. The objective is
to harness that managerial capacity in a way which serves public
purposes, which means that it has to be well defined, it has to
be transparent and it has to be well regulated.
In a community of this
standing where the resources are so rich indeed, the intellectual
resources and the legislative and regulatory resources and so on
are so refined, that's not as much of a challenge as it is in
many parts of the world where the investors so often have the
advantage over governments and the results therefore are
perverse, and it serves to undermine the arguments that the
objectives are worthwhile. They give rise to really serious
political disappointments and public polarization and so on. In a
place like Ontario where the capacity to do it well is so clearly
in place, it seems to me that it's an agenda that can be attempted with relatively
little risk, less risk than most other places.
Mr Young:
The challenge isn't quite as great in this jurisdiction because
of some built-in safeguards, I guess, that exist both judicially
and otherwise. Is that what you're saying?
Mr Potter:
I'm sorry?
Mr Young:
The challenge of ensuring that the process is a fair one is
somewhat less here as compared with some of the international
markets that you might have dealt with?
Mr Potter:
We're capable of defining high standards of regulatory behaviour
in a place like Ontario. We know how to set the rules clearly,
and we know how to arrive at definitions and boundaries and
mechanisms which will do the job. In the absence of those kinds
of mechanisms, you get into all kinds of trouble, in
jurisdictions where that capacity doesn't exist.
Mr Young:
Sure. The final report of the Ontario Jobs and Investment Board,
A Road Map to Prosperity, which was released just about a year
ago today, argued that if Ontario was to remain globally
competitive, major capital upgrades to the province's
infrastructure were needed. The board recommended that the
government should endeavour to invite the private sector to
participate in the necessary capital investments and make
effective use of alternative financing and delivery mechanisms
such as user-pay, privatization, contracting out and
private-public partnerships.
Those comments were made in
the context of being competitive on a global basis, and I'm
wondering if you can comment, as well, on the necessity to
involve both the public sector and private sector in this
endeavour, to ensure that we are, as a province and as a country,
competitive internationally.
Mr Potter:
When I was asked if I would be interested in this job, I read
that report and I thought it was a good report. I thought it was
an objective piece of work which happens to share an economic
point of view which I hold, rightly or wrongly. But having tried
to do this in a place like the World Bank, which is basically in
the business of trying to eliminate poverty and is dealing with
communities where welfare standards are so low, and the whole
bias of the institution is kind of a bottom-up orientation to
welfare, these techniques work even there, and they should work
even better here, in my view, because we have the capacity to do
it well.
1040
I find it hard to
understand why we would not want to harness the wider abilities
of the community managerially, entrepreneurially and financially
to serve a public agenda. It just seems to me the sensible thing
to do, if you understand that there are going to be differences
in their objectives which are reconcilable, but differences which
still have to be thought about and catalogued carefully.
The Chair:
Thank you very much, Mr Potter, for your appearance before the
committee. You may be dismissed now, as they say, and your
appointment will be considered later in the day, at the
conclusion.
Mr Potter:
Thank you, sir.
DIANE BEATTIE
Review of intended
appointment, selected by official opposition party: Diane
Beattie, intended appointee as member, Ontario SuperBuild Corp
board of directors.
The Chair:
The next intended appointee is Diane Beattie, intended as member,
Ontario SuperBuild Corp board of directors. Ms Beattie, do you
have an opening statement you'd like to make?
Ms Diane
Beattie: First, Mr Chairman, let me say that it's an
honour to be asked to be on the advisory board for the SuperBuild
Corp. As most of the members of the committee may not know me, I
thought it would be helpful just to give you a brief
backgrounder.
Since 1988, I've spent most
of my work and volunteer life and time with numerous communities
in southwestern Ontario. I hope the following brief summary
provides you with an overview of my qualifications for this
role.
From the spring of 1988
until 1990, I was the sales manager in Windsor. My
responsibilities in that case included building pipeline
infrastructure throughout Windsor and Essex county for natural
gas. This involved working with businesses, industries and
municipal officials to ensure that Windsor-Essex had the best
possible energy solutions and options to ensure economic
growth.
From 1990 to 1998, I worked
out of the Union Gas office in London in three roles: the region
sales manager, region operations manager and general manager.
Again, in each of these roles a key responsibility was to expand
the pipeline infrastructure, this time in Lambton, Huron, Perth,
Middlesex, Oxford and Elgin counties.
The economic viability of
these projects was often a challenge, as we had to justify the
economics both internally and to the Ontario Energy Board. By
building partnerships and relationships and through collaborative
teamwork with municipalities, we were able to install millions of
dollars of pipeline infrastructure that provided the communities
and local businesses economic advantage.
The relationships we've
built to be successful were with the community, the local
businesses, elected and municipal officials, the MPPs and the MPs
in the area. As I said, it wasn't always easy, but in the end,
knowing that many small businesses and communities viewed this as
a key to their future success was extremely rewarding.
Over the past two years, my
role as director of business development has been to look at
opportunities to further partner with municipalities and
municipal electrics to see if there are opportunities to jointly
reduce costs to customers by working more closely together. In
Chatham-Kent we have established a very successful pilot
partnership with the city and the hydro commission.
In my volunteer life, I've
had a very interesting and challenging five years, first with the
merger of two of London's hospitals, University Hospital and
Victoria Hospital, to
form the London Health Sciences Centre, followed by my term as
chair of the joint committee on restructuring in the city of
London in which we developed a city-wide collaborative approach
to restructuring. Now, as chair of the board of the London Health
Sciences Centre, our current challenge is to build the
infrastructure to provide effective health care for the next 10
to 15 years. The other key challenge is to effectively manage the
operating costs. I think to be successful over the next four to
five years, relationships with communities in southwestern
Ontario that are part of the regional referral area for the
hospital will be absolutely critical.
During this time, I've
built relationships with all of the local MPPs in the London
area. Marion Boyd, our former cabinet minister from the NDP, has
been tremendously helpful, as has Dianne Cunningham and Bob Wood,
who I think normally is part of this committee. As we've moved
forward, I've had to work closely with the Minister of Health,
Elizabeth Witmer.
From an educational
standpoint, I have a degree in mathematics from the University of
Waterloo and an MBA from the University of Windsor. The MBA I did
part-time, so I understand a little bit of some of the things
that other industries were doing, because I spent an awful lot of
time with colleagues in the auto industry etc.
Over the past few years
I've attended executive programs in marketing and finance at the
University of Western Ontario and Queen's University.
As I have not as yet
attended a board meeting for the SuperBuild Corp, I may not be
able to answer your specific questions and issues. However, I
thought it might be helpful to provide you with my understanding
of the role.
Critical to the success of
Ontario is the strategic use of capital to sustain economic
growth. This means that as a province we need infrastructure to
support economic growth and provide a solid base for growth,
infrastructure to be in place when and where it is needed and new
methods of funding that leverage government dollars. The role of
the advisory board is to provide strategic advice on the
long-term direction and approaches of the corporation. It is my
understanding that all decisions on projects and actual
allocations of funds would be made by the government.
In closing, again I'd like
to say I'm honoured to be asked to be a member of the advisory
board for the SuperBuild Corp.
The Chair:
Thank you. We begin with the third party. Ms Churley.
Ms
Churley: Welcome. Thank you for coming today to present
and answer our questions. I believe you were sitting here for
part of the previous round, so you have some idea of the concerns
that are being raised. I wanted to ask you the same thing I asked
the previous person about Highway 407 and that sale and the
balance there needs to be in public-private partnerships where
yes, there's a decent profit for the private sector but the
public is protected. I gave a specific example, and that is the
level of usage that would trigger a cap on the private company's
ability to raise tolls. That's being kept secret. I just want to
ask you, do you think the terms of the contract between the
government and private companies for infrastructure investment
should be made public?
Ms
Beattie: As we move forward with all of these types of
initiatives, they have to be based on a sound business case and
guiding principles. As you work through those and make sure
you've got an understanding of the needs and how you're going to
fulfil those, then you move forward. I agree with the comments
that were made that there is need in some situations for
confidentiality but there's also a need for what was termed
"transparency" and moving forward. So I think each scenario has
to be looked at and each business has to be looked at separately,
and a business case has to be developed and put forward.
Ms
Churley: OK. I wanted to come to the role of SuperBuild,
because, as you know, in addition to the role in infrastructure,
SuperBuild will also review privatization of government assets.
What impact do you think foreign ownership of much of our
electric generating capacity, with profits and decision-making
flowing south, will have on Ontario's economy? Do you think the
government should engage in some kind of public examination of
this issue?
Ms
Beattie: That's a loaded question.
Ms
Churley: It's a loaded question, but that's what's
starting to happen, and I believe that there are, and should be,
some concerns about that.
Ms
Beattie: Again, I think as you move forward in each of
these environments, the business case and the process, the
guiding principles that are going to put things in place, have to
be very clearly articulated and understood. I think as we look in
the energy sector, and in all sectors, we're heading much more to
a global economy, and Ontario has to be in a position that we
have a very strong base and very strong understanding of how we
are going to move forward. That's why I think these guiding
principles and business cases have to be understood in the full
context of what's emerging around the world.
1050
Ms
Churley: You said in your opening statement that the
government will be making the policy decisions and your role is
to advise. Do you see your role as having some concept and say in
the balance I keep talking about and in advising the government
about transparency, about the public's right to know, about the
public being protected? Do you see at all a role you can play as
an adviser there? It's not just the opposition but many people in
the public-we are reflecting here today the public's response to
what happened with 407, and the fact that there's so much secrecy
there. Do you see a role for you to play in that, if you feel the
government is not doing its job in terms of making sure that
balance and transparency are there?
Ms
Beattie: Again, I haven't attended a meeting, so I'm not
sure of all the missions and goals of the organization. I haven't had a chance to
discuss and dialogue that. But I think you have to come back to,
here are the business principles around which we are working in
this environment. If that is a key guiding principle, then it
needs to be discussed and understood: What are the needs? How are
you going to work this through? What are your options and
alternatives? So it really has to have a definitive and
disciplined approach. I think that is what the advisory board can
help with: Here is a strong, disciplined financial environment to
work from.
Ms
Churley: I want to ask if you are aware of any superb
public-private partnerships that have really worked for the
public as well as the private sector. I want to tack on to that a
question on one that didn't work very well, and that was the
water privatization in Great Britain, where huge profits were
made by the private sector but rates went through the sky for
consumers and a lot of people were actually cut off. I don't know
if you are aware of that situation. That is a really good example
of one where the corporate world made a lot of profit and the
consumer ended up paying a lot more. It didn't work for the
consumer; it did for the private sector. That is an example of a
bad one. Do you know of a good one that has worked for
everybody?
Ms
Beattie: Not off the top. I'm sorry, I don't have a good
example for you.
Ms
Churley: Right. You know about the water privatization
one, do you?
Ms
Beattie: I have done a little reading on things that
have happened in different parts of the world.
Ms
Churley: What do you think went wrong in Britain? Maybe
they didn't have a good advisory committee.
Ms
Beattie: Must have been. You have to learn as you move
through these. You have to have a strong learning commitment as
you work forward. I think our challenge is to learn from those
types of examples that some people view as very harmful to the
community and that other people may see as very positive to the
community. We have to figure out the balance and our guiding
principles for moving forward in these types of
relationships.
Ms
Churley: Thank you.
The Chair:
I believe Mr Spina is the government representative. Do you have
some questions?
Mr Spina:
Thank you, Ms Beattie, for accepting the nomination to this
important initiative on the part of the government-at least we
perceive it as an important initiative.
You have an interesting
background, which I guess is a mix of corporate as well as major
community involvement. I think that is an important mix to bring
to the table. I know you haven't been briefed entirely, because
you still are not officially appointed. However, I believe you as
a nominee have been given a document on the overall mandate of
the committee, the board and the corporation.
Let me ask you this: Do you
feel that the context of the board and the philosophy of taking
public sector money from the various ministries will actually
work in leveraging with private sector partners? Will the other
people come to the table, I guess really is my question, in your
opinion, having worked for so long in the private sector?
Ms
Beattie: As you look back through some personal examples
and things that have happened in various organizations, if you
want to focus and have commitment, I think one of the tactics
that works very well in a time frame-and this is a five-year time
horizon-is to focus and bring things together on a centralized
basis so that you do get the ability to prioritize and use funds
in the best possible ways. I think as governments work through
that process, it is very attractive to the private sector to look
at working together, because they understand specifically what
the parameters or rules of the game are going to be.
Mr Spina:
Are we still OK?
The Chair:
I'll give you another one.
Mr Spina:
Good, one more. Thank you, Mr Chair.
Our time gets limited by
the amount of time you speak, and we appreciate the time you put
into it to give us a bit of a broader background.
Are there any specific
areas, from an economic development perspective, where you feel
this province could enhance its competitiveness on a global
basis, which is one of the goals we want to achieve?
Ms
Beattie: As you look at the categories that the
SuperBuild Corp needs to work with and through, I think all of
those categories are absolutely crucial to our well-being.
Certainly from a business perspective, having the highway
infrastructure and the roads to take product to market etc is
going to be critical to us. But if we're going to have a strong
future, having schools and universities that have the facilities
that can teach children and young adults and bring them forward
is also absolutely critical to us. As we've heard in the press,
at least in the last couple of weeks, health care and being able
to have a healthy group of people, to keep moving forward, is
also a major concern.
The Chair:
Official opposition, Mr Crozier.
Mr Bruce Crozier
(Essex): Good morning and welcome. I want to add to the
comments of the others that your background, certainly for this
appointment, is a very good one. I note in particular of course
that you mentioned having spent some time in Windsor and Essex
county; therefore that can't help but add to the background that
you have. In fact, you may be familiar with the expansion of the
greenhouse industry, and when you were with Union Gas that
obviously was part of your responsibility at that time. It's just
absolutely tremendous, and continues in that area.
Ms
Beattie: I think that's where infrastructure and getting
it in place really has helped, because people have worked
together to make that happen. I can't believe how much glass is
going up down there; it's fantastic.
Mr
Crozier: It is indeed.
The board of directors is
now being appointed about a year into the mandate of the
SuperBuild fund. In fact, about 15% of the funds, as you probably
are aware, have already
been designated. I then say to myself, if the government has
operated this with the advice of whoever for a year and 15% of
the funds have already been delegated, does this in any way make
you feel that there has been a direction set by the board that
you would follow, a pattern set, or do you feel the board will
have the flexibility to look at all options in all areas?
1100
Ms
Beattie: My understanding at this point is that it's the
government's and the members of Parliament's responsibility to
actually say, "Here are the funds," and say how they will be
allocated. The responsibility of the advisory board is to help
look at processes and guiding principles to make sure that over
the next five years we do this in a way that's going to be
beneficial to the province.
Mr
Crozier: Help me. Are you saying, then, that
notwithstanding the board's role, the government will in fact
determine what areas these funds are allocated to; that you, as a
board and a board member, will only be concerned about the
process?
Ms
Beattie: At this point, my primary understanding of the
role of the board is that it's to be concerned about providing
sound advice and making sure the processes such as business plans
and business cases are there.
Mr
Crozier: That's interesting. Thank you. I think my
colleague has a question.
Mr
Phillips: Just to comment on that, the board has some
fair power. It recommends, recommends, recommends.
My question is on the
transparency issue, just to get your view as a board member on
how you would handle it. Again I go back to the 407, because I
think that's a rip-off for the users. The owner of the 407
recently raised $325 million in a bond issue. Part of that bond
issue said that if you wanted to buy a bond, you could go and
look at the tolling agreement. It said you could go to the office
and look at it or you could have it sent to you. So the investors
had a chance to look at this.
I phoned them and said:
"I'd like to look at this thing. I'm coming up."
They said, "All right, but
are you going to invest $100,000?"
I said, "Well, you never
know."
"Are you represented by a
broker?"
"Well, I can get one."
"Oh, by the way, if you
come and look at it, you have to sign a confidentiality agreement
that you will never disclose any of the contents of what you are
shown."
My point is this: The poor
users of the toll road, the public, the hard-working taxpayers,
are not given a chance to look at this agreement, but investors,
who stand to make money on the backs of the toll users, do get an
unfettered look at it to make their investment decision. So
you've got this what I regard as totally unacceptable
proposition, which the government put into the contract, where
the money people can look at it and the taxpayers can't. Even I,
as a representative of the taxpayers, am told that if I look at
it, I have to sign a legal, binding agreement that I'll never
disclose what I saw.
You're going on the board
now which will make these kinds of decisions. Would you
contemplate ever allowing that to happen in future private-public
sector partnerships?
Ms
Beattie: Again, I think the comments made earlier are
very appropriate and fall in line here. There are times when I
think, on a general basis, you want to have transparency wherever
you can. But there are certain situations-and I personally don't
have enough background or understanding of all of the things on
the 407 to comment on that, so I can only comment in a general
sense. I think there are times when confidentiality comes into
play. So will you get 100% transparency? I don't think that's
possible.
Mr
Phillips: You're an employee of Union Gas. I would
speculate that Union Gas will be involved in many public-private
sector partnerships in the future. It is at least a question for
the board. An alternative would have been that the government
could have selected a representative of your industry to sit on
the board, but they've chosen individuals to sit on the
board.
Have you any thoughts for
us in terms of how conflict is avoided in the future? I realize
that if Union Gas has a proposal before the board, you would
absent yourself from it, but are there any agreements that you
will not disclose to Union Gas the discussions that take place at
the board?
Ms
Beattie: In the particular case of Union Gas, I'm not
aware that they have any proposals that would come to the board.
If there is information that would be considered to be of a
critical nature or a competitive advantage, then if I'm on this
board there are things that I would obviously have to accept as
this would be considered a competitive advantage and would not be
able to disclose to the organization I work for.
Mr
Phillips: I don't mean to put you on the spot. I'm very
curious about this board. Before you accepted this, were there
guidelines spelled out to you of the things you can disclose to
Union Gas and the things you can't disclose to Union Gas?
Ms
Beattie: We talked generally about conflict-of-interest
issues, and because it's an advisory board and has to do with how
this would work, the processes and making sure we have good
business plans etc in place, there wasn't a significant
expectation that that would happen.
Mr
Phillips: The terms of reference say that the board will
recommend the government privatization initiatives, will make
recommendations on partnerships and develop proposals for capital
investment. It goes beyond, in my judgment, advisory. It's the
board that makes the actual recommendation. It says to the
government, "Here are the projects we believe the government
should be approving." So, as I read these, the role is more than
merely advisory. Or am I misreading the role of the board?
Ms
Beattie: I can't answer that one, I'm sorry.
Mr Phillips: I don't mean to put
you on the spot. You happen to be one of the few we can interview
and you do have a private sector employer. As I say, there was an
alternative, which was to say, "We need someone from the
university sector to represent the universities, someone from the
colleges, someone from the utilities sector." I think there's
someone from Hydro coming on. But they've chosen to go a
different route. I think you've answered my question on what's
been agreed upon between yourself and the board.
The Chair:
Thank you, Mr Phillips, and thank you, Ms Beattie.
What I will do, to be of
assistance to particularly the government members, is indicate
the time each party has ahead of time so that we will be aware.
As has been pointed out by Mr Spina, but for anyone in the room,
the normal procedure is that any time that is taken in the
initial statement by the intended appointee of the government is
subtracted from the time the government members have to ask
questions. So in fairness to the government members I should be
indicating the precise amount of time. I'll try not to cut you
off in midstream or anything like that.
MARY MOGFORD
Review of intended
appointment, selected by official opposition party: Mary Mogford,
intended appointee as chair, Ontario SuperBuild Corp board of
directors.
The Chair:
Our next intended appointee is Mary Mogford. Welcome to the
committee, Ms Mogford. Do you have an opening statement?
Ms Mary
Mogford: Good morning, and thank you for inviting me to
meet with you to share some information on my background and
experience, and more particularly why it is that I believe I'm
qualified to sit on the SuperBuild board.
As you'll see from my
brief, a more up-to-date CV that Mr Arnott is just handing out,
my background has given me extensive experience in the public
sector, in the private sector and in the broader public sector.
As you know, all three sectors are key partners under
SuperBuild.
First, I had a long public
service career across a broad range of ministries over 22 years.
I began my career as a junior economist in the Ministry of
Treasury and Economics, moved from there to the Premier's office
as a secretary of the cabinet committee on resources development
and was a policy adviser to the Premier on economic development
and resources issues. From there I moved to become executive
director of finance in the Ministry of Community and Social
Services, and after that moved to the Ministry of Natural
Resources, where I spent 13 years, first as director of policy,
then as assistant deputy minister and finally as deputy minister
working first with Premier Harris when he was Minister of Natural
Resources and then with Mr Kerrio.
After that, I became Deputy
Treasurer of Ontario and Deputy Minister of Economics in Premier
Peterson's government, working with Mr Nixon as Treasurer before
moving to the private sector in 1989.
1110
In many of these different
roles, I had a good opportunity to be aware of and understand the
critically important role of infrastructure in contributing to a
sound and vibrant economic base. For example, during my early
years in treasury and economics, I was based for much of the time
in northern Ontario, where I worked with municipal and business
leaders from White River to the Manitoba border on a
socio-economic assessment of the region. This led to a report
called Design for Development: Northwestern Ontario, which laid
heavy emphasis on the importance of a broad range of
infrastructure for improving the potential for the economic
development of the region, and a number of the suggestions made
in the report have been implemented since.
After that, my close
involvement in the natural resources sector during my years in
MNR gave me a much greater appreciation of the importance of
infrastructure on the effective functioning of the economy. Of
course, in treasury and economics, or as it's now called, the
Ministry of Finance, I was consistently aware of the role of
infrastructure in contributing to the investment climate and to
economic growth as a key component of budget and fiscal
policy.
Since 1989, I have been in
the private sector, first as a partner in my own firm, Mogford
Campbell Inc. However, given the time pressures associated with
both my corporate and my volunteer board involvement, I'm not
involved in active consulting work at present. Increasingly,
instead, I focused on my role as a corporate director with a
number of national and international corporations in the natural
resources, health, financial, retail and e-commerce sectors.
However, my private sector experience across this wide range of
business sectors has again given me a good perspective on the
need for sound infrastructure in contributing to economic
growth.
Also since 1989, I have
been active in the volunteer sector. I have had the opportunity
to sit on the board of governors of Trent University and the
board of trustees of the Hospital for Sick Children, where I'm
presently vice-chair. From these experiences, I think I have a
much clearer understanding of the role the broader public sector
partners could and indeed do play in creative approaches to
enhancing the infrastructure base of our province, given the
encouragement and support to be creative.
Finally, it was in another
volunteer role, as part of the Premier's Jobs and Investment
Board, that I gained a clearer and more up-to-date understanding
of the infrastructure challenge facing us in our province. I was
one of 16 private sector members who sat with the Premier and
four ministers on the Jobs and Investment Board, which was
established in May 1998 and reported to the government, as has
been said this morning, in March 1999.
Our process involved people
across Ontario through stakeholder consultations and seven public
conferences. I believe
that more than 1,600 people were involved. We also had a series
of expert panels. Our task was to produce an action-oriented plan
for jobs for the people of Ontario in the 21st century. As
background, we knew that the IMF, the Conference Board of Canada
and the House of Commons finance committee agreed we must take
steps to protect our standard of living. The OECD forecasts a
substantial decline in Canada's economic performance and quality
of life unless we prepare ourselves better for the challenges of
the future.
The members of the
committee will, I know, be familiar with the Jobs and Investment
Board report, but I'd like just to take a moment longer because I
believe it is relevant to my credentials for serving on the
SuperBuild advisory board. We focused our discussion on three
areas we considered essential for Ontario's long-term economic
success: preparing people for tomorrow's jobs, creating an
innovation culture and creating infrastructure to support growth
and competitiveness. Out of this third area of focus, we told the
government that there was a sense of urgency that had been raised
by experts, stakeholders and people across Ontario regarding the
growing infrastructure challenge. We told the government that to
stimulate jobs and investment, all segments of Ontario society
need to recognize the importance of participating and competing
successfully in the global economy.
We also told the government
that to attract new investment to Ontario, we need to develop
world-class infrastructure, including transportation gateways to
connect Ontario to the global marketplace; urban infrastructure,
especially in the GTA and surrounding areas; and smart networks
to make Ontario the global leader for the next generation of
Internet and electronic business. We also recommended that the
government should invite the private sector and other government
partners to participate in the necessary capital investments.
It was this sense of
urgency and call for action which we detected through our
discussions across the province and which we reported to the
government that led to the creation of the Ontario SuperBuild
Corp. I'm positive about the potential role that SuperBuild can
play in addressing these issues and I look forward to the
opportunity of serving on the SuperBuild board.
The Chair:
The government for four minutes.
Mr Young:
I appreciate the opportunity of asking a few questions of Ms
Mogford. As I indicated with some of the earlier individuals who
have come forward to this committee this morning, we are
certainly fortunate to have people of your experience and
calibre, and I thank you for putting your name forward.
My question relates to the
process that you would be asked to speak to if your appointment
is approved, a process that would ensure that these
public-private partnerships across the province are fair and
reasonable ones. I wonder if you can speak to some thoughts you
might have about how that can be ensured so that any tax dollars
that are being put forward will be properly spent.
Ms
Mogford: As has been mentioned by the other potential
candidates for the board this morning, our role is advisory. We
have no governance responsibility, no authority. Our role is to
bring forward ideas for potential capital investments, for
private sector partnerships, and also for potential divestments
for privatization. The minister has challenged us to come forward
with new and creative ideas that would fall into those
categories.
As far as the balancing,
quite a bit has already been said this morning about the
balancing between the business case and cost-effectiveness and
the public interest. That is something that obviously the
government would-within the actual implementation of the capital
investments, that would be taken care of.
Mr Young:
I take some solace, though, from the fact that, given your
extensive experience both in government and in the private
sector, you will bring with you the ability to ensure there are
appropriate guarantees in place or be able to recognize what sort
of endeavour might be fraught with danger. I trust you have the
confidence, going into this, that you have the experience in both
private and public to address that.
Ms
Mogford: Yes, not only speaking for myself, but if you
look at the range of experience and very impressive credentials
on the part of my colleagues who are to be recommended for the
board-
Mr Young:
Quite so.
Ms
Mogford: -there is vast experience across the sectors-as
Mr Potter said, financial, telecommunications, technology and
resources etc-and also international experience that I think
would point to the issues you are raising.
Mr Young:
I know we're going to run out of time.
The Chair:
Keep going; you're fine.
Mr Young:
Thank you, Mr Chair. I wanted to ask you to briefly address the
issue of technology, what role you envision that will play in the
future of this province and what role the Ontario SuperBuild Corp
will have in nurturing that and bringing it along.
Ms
Mogford: I'd like to do that. The broad range of
potential infrastructure candidates and areas certainly includes
technology. I think I mentioned that as part of the jobs and
investment report we recommended to the government that we needed
to place Ontario in a position to have effective, functioning and
vibrant smart networks to make Ontario the global leader for the
next generation of Internet and electronic business. So I would
think it would be a very crucial part.
The Chair:
The official opposition.
Mr
Phillips: Your background is very impressive and we're
fortunate that someone of your calibre is prepared to work on the
board.
My first question-I don't
doubt that we need to spend $20 billion on infrastructure over a
five-year period, and I have no difficulty with private-public
sector partnerships. It's reality. It's more along the lines of
running the risk of fooling ourselves, thinking we can't afford
to spend $20 billion so we'll get the private sector to build
half of it, when in reality much of it is essentially getting the
private sector to build it and the government or the taxpayers
simply paying for it out of tolls, a stream of revenue for a water system or leasing a
new building instead of buying the building.
You now have been involved
in this for some time. My question really is, what are some
examples of private-public sector partnerships that are not
simply borrowing money in a different way, either with a new fee
or a lease, just to give us some comfort that it is realistic
that we can have $20 billion of new infrastructure built that we
don't simply pay for by a tax with a different name?
1120
Ms
Mogford: Could I comment on what you said first before I
answer your question?
Mr
Phillips: Of course.
Ms
Mogford: I think it would be important to step back a
little. As you know, we're not just talking about the Ontario
government and the private sector. We're talking about Ontario,
the private sector and other governments. If you look at the
infrastructure base at present, the 200-plus, Ontario is
responsible for 9% of the present infrastructure base and the
municipalities for 22%. Forty-nine percent is already provided by
the private sector. So it's not as though we're coming to a clean
slate and starting from scratch.
If you ask me for examples
of where it's working, and it's not just a tax or whatever, let
me give you an example from my own backyard. I live in the Durham
region. As part of the recent announcement of Colleges and
Universities, the new Durham College manufacturing and technology
information centre is to be funded out of SuperBuild.
The total cost is $48
million. As I understand it, $28 million is coming from
SuperBuild, from the Ontario government, and $16 million is
earmarked to come from the private sector. I think $1 million or
$1.5 million is coming from General Motors and the Canadian Auto
Workers and another $1 million is coming from Nortel. About three
technology companies are putting up another $1 million. There's
Schneider Electric, another $1 million. You have that, plus $6
million coming from the institution, and I think it's going to
create over 3,000 new potential enrolment spots at Durham
College. I'm using that one because it's very close to me in my
own backyard.
Mr
Phillips: I went through all of those, and in my opinion
they are private sector contributions like any other time. It
isn't a private sector partnership.
My other question is the
one I asked before on the 407-I think you were sitting there. I
feel it is totally unacceptable that the users of the 407 are not
given access to this tolling agreement, and those who want to
invest in the 407 are given unfettered opportunity to peruse it.
You are going to be chair of this new board. Is that acceptable
behaviour, where a company gives unlimited access to the money
people but says to the public and to someone like myself, "You
can look at this, but you have to sign a legal agreement that
you'll never reveal any of the contents of it"?
Ms
Mogford: I think my two colleagues who preceded me this
morning have commented quite appropriately on that with respect
to the business case and the balancing. I'm not familiar with the
details, so I think it would be inappropriate for me to comment.
I don't know the specific details. All I can say is that when you
are involved in new ways of doing things-and the minister is
charging us with coming up with new and creative ways of doing
all the things in our mandate, advising him-it's important, as
you go through and you have examples, that you learn from them as
you go along. But I'm afraid I can't comment on the
specifics.
Mr
Phillips: Any more time, Mr Chair?
The Chair:
Yes.
Mr
Phillips: Not looking back but looking forward, as I
say, I think the 407 user was abandoned in this process-
Ms
Mogford: I'm a 407 user; I use it regularly.
Mr
Phillips: Well, I think you were abandoned in it. I
think you're paying twice the tolls you should be paying. My
question is, now that you are, or will be, the chair of this,
what safeguards will you build into the process to make sure that
the ultimate users of these services will be considered first and
foremost?
Ms
Mogford: If I could go back, I think it's important to
remember that our role is advisory. We will give the government
advice that they can accept or reject. We have no authority;
however, looking forward rather than looking back, I think right
across the board-I'm not being specific on the 407-if, as we go
forward, there are things we can learn and put into our advice,
we would quite appropriately do that. Again, I'm not being
specific to the 407.
Mr
Phillips: The role of this board is to "recommend
privatization initiatives." It isn't merely advisory; it seems to
me that this is the board that makes proposals to the
government.
Ms
Mogford: No. We would recommend candidates; we would
recommend ideas. Again, it's advisory; we have no authority.
Mr
Phillips: It says, "recommend privatization ... make
recommendations on partnerships ... develop proposals for capital
investments." It seems to me that if you want to get a private
sector SuperBuild project approved in this province, it has to go
to your board.
Ms
Mogford: I would not necessarily anticipate the
individual projects. I was wondering, when you were saying that
before-the role of the corporation is specifically that. The role
of the board is advisory to the minister. But I think I was
reading from that-
Mr
Phillips: Do you mean that Mr Lindsay can send
recommendations directly to the government without going through
the board?
Ms
Mogford: No. The broad range of candidate ideas would
come to the board. I have to say we're at a formative stage;
we're just working out how we will function. But we will be asked
by the minister for advice in specific areas. The way it's going,
I believe we ourselves will put forward candidate ideas for areas of
potential capital investment, areas of potential
privatization.
The Chair:
You have until 11:34.
Mr
Phillips: This seems at odds with the role of the
SuperBuild Corp. It's more than just a loose advisory group.
Ms
Mogford: If you look at the authority chain, as opposed
to the advisory chain, you'll see we have no governance or
authority responsibility. But there is the SuperBuild Corp, there
is, as you say, Mr Lindsay, the CEO, there is a cabinet
committee. It's very well laid out, and Mr Lindsay and the
minister have both spoken on that.
Mr
Phillips: Don't the proposals go to the board and then
to the government? Don't all proposals-
Ms
Mogford: The broad range of proposals would go to the
board. We have not yet worked out whether it will be every
specific one. We are looking at the broad range of ideas.
Mr
Phillips: The way it has been explained to us, the
recommendation of specific proposals would come out of this
SuperBuild Corp. I hadn't contemplated that Mr Lindsay could send
a proposal that hadn't gone to the board. I assumed that any
proposals from Mr Lindsay would have to come to the board.
Ms
Mogford: I anticipate they would all come through, in a
broad fashion. But we have no authority; we have no
decision-making authority.
Mr
Phillips: But you have the authority to make
recommendations on the initiatives-
Ms
Mogford: To give advice.
Mr
Phillips: -and I presume that any recommendations on
SuperBuild have to go through your board.
Ms
Mogford: That is something we're still working out.
We're still working out our business plan.
Mr
Phillips: Has the board developed a conflict policy?
Ms
Mogford: Again, there's been a lot of discussion on that
point so far. Being an advisory body, it is very unlikely that
conflicts of interest would arise. If they did, we as individuals
would declare them.
The Chair:
Thank you, Mr Phillips. The third party, Ms Churley.
Ms
Churley: Thank you very much for joining us this
morning. I think the last question from my colleague Mr Phillips
reflects perhaps what is building up to a little frustration
here, because our understanding of the role seems to be somewhat
different from the candidates'. Certainly I have an expectation
that there is a board that actually, yes, doesn't have the final
authority to make decisions, but does have the power to make
recommendations. I have to tell you that I would feel much more
comfortable knowing this board also acts as a bit of a watchdog.
The users of 407 are very clearly being ripped off-you are.
That's been documented by now. We have evidence that what the
government did has increased profits for the corporation at the
expense of the public who are using it. I see that as an example
of something that's gone wrong in the process, and we don't want
a continuation of that.
1130
You're going to be the
chair. I don't want to put you on the spot, but I consider this
to be a very important appointment process we're looking at
today. I would like there to be some acknowledgement that there
are some problems with Highway 407, with what's happening to the
ordinary consumer who uses it and the secrecy that's been put in
place between the government and the private sector where
ordinary people, as Mr Phillips has been saying, can't get
financial information and, as I mentioned earlier today, the
private company can raise tolls at a certain threshold but we
don't know even what that threshold is.
Even though you don't have
the capacity to make decisions, let me ask you, do you feel that
it's important as the chair of this advisory panel, with your
colleagues, to look carefully and recommend to the government
ways to protect the public so that that balance is there which we
lost?
Ms
Mogford: Again, I'm sorry. I can't comment on 407
specifically because I'm not familiar with the details. I respect
your opinion, but I can't comment on what you're saying.
Going back to the broad
range, however, of the types of advice we will give, again our
task is to come up with new and creative ideas as advice to the
Minister of Finance across the broad range of potential
infrastructure candidates and divestment candidates. To the
degree that something was clearly, from the perspective of
individuals on the board or the board itself, not in the public
interest or clearly out of balance, I'm very sure we would give
that advice. But again, it's a hypothetical question. It would
have to be around a specific candidate or set of candidates.
Ms
Churley: Let me turn to something else which was touched
on earlier, and that is your ability to lead and coordinate
capital planning across the Ontario government. I believe it was
the Globe and Mail that released last year what was considered to
be a confidential background cabinet briefing on the SuperBuild
Growth Fund which said that over the next five years the
province's capital investment needed to amount to at least $40
billion, compared to the SuperBuild's target of $20 billion.
There are all kinds of things not even considered in that $40
billion, as you know; for instance, even the cleaning up of
abandoned mines, and it goes on and on.
Given that the fund is less
now than what the NDP was putting in in the last year of
government and less than what this government had been putting in
previously-now it's $2 billion a year; it's gone down-what would
your priorities be, given the need out there for infrastructure
investment and the insufficient funding?
Ms
Mogford: I think actually the current annual figure is
$2.9 billion as opposed to $2 billion.
But going to your question,
I think both the Premier and the Minister of Finance have agreed
that there is a major problem in their comments on the quotes
that you're making
there. Certainly there's a lot to do, and that actually confirms
what the Ontario Jobs and Investment Board brought forward to the
government in terms of the sense of urgency. Again, it's because
of that sense of urgency that the SuperBuild advisory board has
been charged with coming up with new and creative ideas that
would enable more to happen through the engagement of partners
across a broad range, across not only Ontario, but the private
sector and the broader public sector partners, that we could do
much more toward the infrastructure growth challenge and the
infrastructure deficit than any of those partners could do
alone.
Ms
Churley: I do stand corrected. You're right, it's $20
billion over five years and $2.9 billion this year. Thank
you.
The Chair:
Thank you, Ms Mogford.
As you would be aware,
members of the committee, we have Mr Weiss next, Mr Minogue this
afternoon and Ms Alidina this afternoon. We would probably
conclude somewhere just around 2:30, that period of time, just in
case you're wondering what your next appointments are.
DONALD WEISS
Review of intended
appointment, selected by official opposition party: Donald Weiss,
intended appointee as member, Ontario Public Service Pension
Board.
The Chair:
Our next intended appointee we will ask to come forward please,
Mr Donald Weiss, intended as member, Ontario Public Service
Pension Board.
Welcome to the committee,
Mr Weiss. Do you have an opening statement you'd like to
make?
Mr Donald
Weiss: I do. I'd like to begin by saying how honoured I
am to be here today as a nominee for membership to the Ontario
Public Service Pension Board. I fully recognize the importance of
the board's work to Ontarians and I am very pleased to be
considered for this position today.
I hope to use this brief
statement to demonstrate that I'm not only qualified for this
position but I am ready to bring to it an extra measure of
dedication and skill. As you will see from my resumé, I have
extensive experience with direct relevance to the pension fund
industry. My 26 years in the financial services field began with
Canada Permanent Mortgage Corp, followed by Morguard Trust Co,
which was owned by five large Canadian pension funds.
Morguard Trust provided
origination, underwriting and administration of mortgage services
to the Canadian pension fund industry, as well as secondary
market trading and the management of two mortgage investment
corporations which were also owned by Canadian pension funds.
My tenure there, during
which I rose to the position of president and CEO, was an
excellent training ground for understanding the challenges and
potential of the pension fund industry in Canada. I was
responsible for the full operations of the trust company, I
played a key role in the design and launch of Morguard Bank of
Canada, and I managed an organization of 200 employees with $4
billion in assets under administration and achieved up to $700
million a year in loan origination investments.
My work experience also
extended to other areas of investment. For three years I worked
with Development Concepts, a real estate development consulting
company. We worked with private companies, institutions and
government agencies on assignments ranging from the
transportation industry to tourism, retail, commercial and office
and warehouse developments as well. This position capped more
than a quarter of a century in the financial services field.
Along the way, I learned a tremendous amount about real estate
finance investment industries and the role played by pension
funds in those areas.
Following this, I entered
my present position as executive director of the PC Ontario fund.
As a result, I gained significant experience in direct mail
marketing and individual and corporate fundraising, as well as an
excellent insight into the workings of government and its
interaction with corporations and individuals.
As you can see, I have had
a varied career. However, all my employment has had a common
thread. Each position I have held has demanded responsibility,
prudent decision-making and the delivery of service of the
highest quality to customers and clients. I have met these
challenges with optimism for the future, tempered with realism
about the present and knowledge of the past. Those are the
qualities I bring before this committee today. I see a vibrant
economy in Ontario and across Canada and I am optimistic that the
board can meet its goal of obtaining maximum returns with minimum
risk.
But I also see the
challenge of stock markets dominated by a very narrow band of
stocks and declining bond prices at present. I'm realistic about
the impact they will have on pension fund investment returns. I
know that the board has navigated these kinds of tricky waters
many times in the past with a confident hand guiding the process.
I would take it as an honour to be one of those hands and to help
ensure that the Ontario Public Service Pension Board meets its
objectives and the challenges of the future. I am prepared to
offer all the knowledge and skill I have acquired and to fulfill
my responsibilities with dedication to the best interests of the
board and the people it serves.
I plan to finish performing
my current duties at the PC Ontario fund in the next few months,
and while I'm performing those duties I will waive the standard
per diem.
What the board does is
important and I'm honoured to have been nominated for this
position. Thank you very much for your consideration.
1140
The Chair:
Thank you, Mr Weiss. We'll begin with the official opposition for
10 minutes.
Mr
Crozier: Mr Weiss, welcome. In positions such as this,
one of the normal questions is sometimes, "Are you or have you
ever been a member of the Progressive Conservative Party?" but I
guess I don't have to ask that today, do I?
Mr Weiss: I am a member.
Mr
Crozier: Can you tell me approximately, in your position
as executive director of the PC fund, how much money has been
raised since 1992?
Mr Weiss:
I honestly don't have that gross figure offhand. I would know it
year by year. The 1992 number-I believe we've achieved something
close to $4 million gross revenue from all sources. We moved
that number upward over the years. We reached $7.5 million in
1995. In 1996, 1997 and 1998, we raised in that range as well. I
think we were $7.6 million, $6.9 million, and up to the end of
1998, we achieved $7 million, approximately.
Mr
Crozier: I asked that for simply no reason, and
certainly I could say that's a job well done. So it's been tens
of millions of dollars that you've raised and perhaps you'd like
to elaborate. You said you would be winding down this position in
the next few months. I would appreciate it if you could be more
specific than that, because you are going to be a member of the
pension board in the meantime. Do you see then your position,
being in charge of corporate fundraising for the Progressive
Conservative Party, as being any kind of a conflict while at the
same time you're managing investments for the Ontario pension
fund?
Mr Weiss:
I don't see it as a conflict. My responsibilities at the PC
Ontario fund are, again, to look after the financial needs of the
party, to meet the particular goals that we have. I do want to
move back to the private sector. This has been a desire I've had,
and over the next few months I will be moving out. I've hired a
successor. In fact, he arrives on Monday, and as soon as he is
able to take over the operations I will withdraw from it.
Mr
Crozier: You wouldn't see any conflict, and yet wouldn't
the Ontario public service pension fund be investing, perhaps, in
companies from which the Progressive Conservative Party, and
others for that matter, would be soliciting funds?
Mr Weiss:
Investments made by a pension fund could encompass the global
picture. The monies sought by a political party could cover a
wide spectrum as well. I don't see a conflict and I don't see the
fact that a political party would make a request of a donation to
the democratic process and feel that it was a conflict with a
role being played in terms of investments. It's an entirely
different position.
Mr
Crozier: I'm pleased to hear that you feel that way,
although I don't quite share that opinion that there would be
absolutely no conflict of interest. Let me put the question this
way: Notwithstanding the fact that you don't think there would be
any conflict, what could we assume you would do if a conflict
arose?
Mr Weiss:
I would certainly declare a conflict if I encountered one.
Mr
Crozier: Thank you.
The Chair:
Mr Phillips.
Mr
Phillips: There are few things that are more sensitive
than pensions. It's an emotional thing for all of us, planning
for our retirement. I have no doubt about your professional
credentials and all of that; it's more whether it's appropriate
on something as sensitive as public service pensions. Mike Harris
has lots of opportunities to appoint you to a variety of things.
How do we respond to pensioners who say, "What is the government
doing putting an obvious partisan on the board?" As I say, it has
nothing to do with you, Mr Weiss, it's more that you are totally
tied to the party right now. Why wouldn't you have sought another
position that isn't as sensitive to this and let the Premier
appoint to some sensitive board like this someone less clearly
tied?
Mr Weiss:
I've pursued this position from the point of view that I feel I
can contribute the most to this particular industry. The pension
fund industry is something that I'm very familiar with, that I
have worked with in the past and that I enjoy. I feel that my
knowledge and experience can make a contribution to this fund. As
well, I would enjoy being part of it in the future. I targeted
this as something in my career. I don't think my membership in a
political party should take away any opportunity to go into and
pursue an area that I have a definite interest in and that I feel
I can certainly make a contribution to.
Mr
Phillips: As I said, it just happens to be in this
highly sensitive area, and there are many Conservatives who
aren't quite as closely tied as you would be with the PC
fund.
You've indicated some
caution on the stock market. You are probably familiar that right
now the government pays out in cash payments to the teachers'
pension and the public service pension about $1.1 billion but
records on its books, its annual financial statement, not an
expense but a revenue of about $300 million. So they are laying
out about $1.1 billion in cash but on the financial statement
showing revenue of about $300 million. That is exclusively
because the stock market has gone up, the assets and the funds
have gone up, and the way the government accounts for things,
rather than show an expense, it shows a revenue. It's making a
profit, if you will, of $300 million a year on the teachers'
pension and the public service pension. You've indicated some
concern that the stock market continue to see the performance it
has. Is this an appropriate way for us to be looking at the
finances of our pensions: expensing $1.1 billion in cash and
showing a profit of $300 million?
Mr Weiss:
I'm not familiar with the accounting or what reporting goes on in
that particular area. I'm just not familiar with it. A pension
fund, again, is there to meet the particular needs of the
beneficiaries under that plan and to meet the particular
actuarial needs. The pension fund competes with every other
pension fund in the industry to find the best investments it can
and get the highest return for the minimum amount of risk to meet
those needs of its beneficiaries. That is its focus, and it's
ability to do that and sustain that is important. All pension
funds will face adverse markets. Markets move up and down, they
move away from you, and the boards guiding the investments to
these funds need to be diligent and prudent in making sure they
meet the actuarial requirements to fulfill the pension needs of
those individuals. The
individual contributors, the beneficiaries, are of utmost
concern.
Mr
Phillips: You indicated that you sought this position
and you know the industry very well. I was a bit surprised you
weren't aware of the accounting. You've now had a chance to look
at the pension portfolio of the public sector, I assume. Have you
any advice for the committee on the approach you would take? Are
we over-invested in the equity market? Are there things there
that you think you can make an impact on?
1150
Mr Weiss:
One of the roles of the board, as I understand, is to develop the
investment policy. To be a member of the board is to be part of
the development of that policy and the administration of it and
to consider it for change from time to time, I assume. To those
kinds of issues, as a board member I would certainly contribute
my knowledge and my experience in helping set the direction of
change if change is required.
The fund at present
certainly has an investment policy and they are following it and
they are achieving returns. I understand this fund now has no
unfunded liability. It has crossed that point and it certainly is
meeting the actuarial requirements to fulfill the plan. I would
take those issues into consideration with the rest of the board
members.
Mr
Phillips: Were there any other-
The Chair:
Sorry, Mr Phillips, that is the end of your time. Third
party.
Ms
Churley: Thank you for joining us this morning. I'll
start by thanking you for being very clear on your resumé
what your party affiliation is and what you do, because I think
it's important that the committee has an opportunity to question
people with very clear partisan connections, and, having the
opportunity, it's important to do that. My Liberal colleagues
have asked some questions about that. I want to follow up a
little bit. You sought this position yourself, I assume; the
government didn't approach you?
Mr Weiss:
I did.
Ms
Churley: In terms of your resumé and looking at it,
what do you think is the most important thing about your
background that can help you contribute in a positive way to this
position?
Mr Weiss:
It would be my years of experience in the related industry, my
experience with the pension funds and their functioning
themselves and looking after their investment needs. I certainly
have a lot of experience with administration within corporations.
We have built portfolios for pension funds in the past and
administered them, and that knowledge I think is the most
important thing I bring.
Ms
Churley: When you applied for this position, were you
concerned about the partisan nature of this place and that there
would be real concerns about your position as a fundraiser for
the PC Party?
Mr Weiss:
I never gave a lot of thought to that. I looked at it purely from
the perspective of, can I contribute to this entity? Can I play a
meaningful role there? That was my consideration.
Ms
Churley: I want to ask you a couple of specific
questions about the pension board. I'd like you to comment on
what thoughts you may have-and I know you're new coming to
this-on how the pension fund should be invested or its
performance in the market. According to annual reports, the
pension board generally follows a low-risk investment strategy.
I'm just wondering if you can give me your thoughts on where
you'd like to take it.
Mr Weiss:
That is a stated policy as articulated in their annual report.
Pensions are serious investment issues. They are what is going to
provide pensions into the future for people. I think a lot of
diligence and care has to be taken in the investment field when
you're managing a portfolio of this nature. The stated policy of
maximizing returns and minimizing risk is a difficult path to
follow, but I would say that when you look at the investment
policy, it speaks to a conservative approach to investment. It's
not heavily weighted in some of what might be considered the
higher-risk areas. I think that's a very positive thing and that
certainly meets the needs from the actuarial perspective, but it
also meets the needs of people. I don't think they want their
pension investments in to high-risk areas; they want to be
reasonably certain the investment they make will give them the
returns they expect, as well as their principal.
Ms
Churley: Those are all the questions I have.
The Chair:
We have the governing party for five minutes.
Mr Spina:
Thank you, Mr Weiss, for coming forward today. I compliment you
on probably going after the job as opposed to being asked for it.
Personally, it's not a favourite of mine; I wouldn't jump into
that. But it's a daunting position, given the scope and the
breadth of the fund.
Partly to address some of
the sensitivity that Mr Phillips, Mr Crozier and Ms Churley
brought forward about partisanship, have you met or do you know
Mr Somerville, who is currently the chair of the fund?
Mr Weiss:
I have met Mr Somerville. I have met him in the past and met with
him recently. I've been aware of him over the years. He was in a
competing industry years back, so that's when I first became
aware of him, but I can't say that I personally know him.
Mr Spina:
He was appointed by the Peterson government and we have since
reappointed him in that position. What I wanted to draw forward
is the fact that even though the individuals may have had some
partisanship or relationship from the beginning, I think they
have been able to demonstrate that they can move forward and be
objective in the administration of their responsibility. I think
Mr Somerville has done a creditable job, and I wish you well. I
think you will work well with that organization, Mr Weiss.
The Chair:
Any other government members?
Mr Young:
I too thank you for putting your name forward, Mr Weiss, and for
the forthright manner in which you did so. Ms Churley correctly
pointed out that you're certainly not hiding anything, and I
don't think anyone here
should suggest otherwise. As I read your resumé and hear
what you have to say today, you have a proven record of success,
be it over the last eight years or before that.
I wanted to ask you a
question, if I may, about what you did in the previous 20 years,
that time between 1972 and 1992. Over that period of time you
worked for a number of different companies. Actually, I guess it
goes back 30 years if you go back to the Canada Permanent
Mortgage Corp. Tell me about changes that you experienced in the
market over that period of time in investment strategies
generally, if you would, and then if you could bring us forward
to some new challenges that exist for investors and pension funds
in this day and age.
Mr Weiss:
Seeking investments for the pension fund industry-we also did it
for other industries later on, including banks, other trust
companies-markets change, and investment opportunity returns.
Everyone's out there looking for the optimum investment, and we
would seek these investments in the marketplace and present them
to pension funds for consideration to their portfolios along the
way.
Changes, yes. When you look
back, you get into some very difficult market times, 1979 to 1981
in particular, a very difficult time in terms of investment. It
takes on a new level of management from an investment perspective
to deal with investments falling apart, corporations going down.
You get into the eras of prosperity, where you have a lot of
inflationary periods, prices rise, costs go up dramatically.
Being able to sit back and
say, "What is the sensible thing to do from an investment
perspective?" is a question we're always asking, and the dynamic
is there every day. Today would be no different in that respect.
If you look at the stock market today, you have a narrow band of
investment. The Internet and technology stocks drive the
marketplace, drive most of the returns. From an investment
perspective, a pension fund has a long-term view generally. A lot
of vigilance is required, and just really a constant, on-top-of
watching.
The Chair:
Thank you, Mr Weiss, for appearing before the committee. You may
stand down.
I'll say to members of the
committee that we will reconvene at 1:30 pm with Mr Peter Minogue
as an intended member of the Ontario SuperBuild Corp board of
directors, followed by Shehnaz Alidina, intended member of the
Ontario Rental Housing Tribunal.
Mr Young:
Just before we adjourn for the lunch hour, is it the intention of
the committee to then deliberate immediately after the last
candidate comes forward?
The Chair:
Yes, Mr Young, it will be.
The meeting is
adjourned.
The committee recessed
from 1201 to 1330.
The Chair:
The meeting is called to order. Ms Churley has a point of
order.
Ms
Churley: I'd like to ask the committee to direct you,
the Chair, to accept an amendment to the substitution slip for me
for the whole day, replacing Tony Martin, who couldn't be here.
That is because Mr Martin couldn't be here today. I had subbed in
for this morning and Frances Lankin for this afternoon. She's ill
and can't make it. So I would respectfully ask the committee to
direct you, Chair, to make that amendment to the substitution
slip I put in this morning.
Mr
Johnson: Are you asking for unanimous consent to add the
second one?
Ms
Churley: Yes.
Mr
Johnson: Yes.
The Chair:
We have unanimous consent. Thank you, members of the
committee.
Ms
Churley: That means I can vote, right?
The Chair:
That is correct. They have accepted you.
Mr
Johnson: Oh, no.
Ms
Churley: All the power there is.
The Chair:
They've accepted you for this afternoon.
Mr
Phillips: That means we'll lose by one less.
PETER MINOGUE
Review of intended
appointment, selected by official opposition party: Peter
Minogue, intended member, Ontario SuperBuild Corp board of
directors.
The Chair:
Our first intended appointee this afternoon is Mr Peter Minogue,
intended member, Ontario SuperBuild Corp board of directors. This
is from the certificate received on February 18, 2000. I
believe-and members will correct me if I'm wrong in this, when we
do start-that when we do start, we will start with the New
Democratic Party. I think last time I started with the Liberals.
It will be the New Democratic Party, the third party, in this
case.
Mr Minogue, if you'd like
to come forward, please, and if you wish, you may make an initial
statement to the committee.
Mr Peter
Minogue: I would like to make an initial statement.
Having worked on economic development projects for the near
north, I know how important infrastructure is to our economy.
Highways are our link to the south, to markets for our goods and
services. But roads are only part of our infrastructure.
First-rate schools, colleges, universities and hospitals are
essential to attracting new investors and jobs. More importantly,
they strengthen our communities and our quality of life. That's
why I was so pleased to hear that Finance Minister Ernie Eves
planned to add a northern representative to the SuperBuild board,
and I am honoured to have the opportunity to serve in this
capacity.
I believe that my business
experience will make me a strong addition to this board. At the
present time, I'm president of four businesses: Coldwell Banker
Peter Minogue Real Estate, Morland Real Estate Appraisals,
Callander Bay Developments and Osprey Links Golf Course. Having
founded these companies, I know what's involved in the start-up,
and that experience is especially useful in a new initiative like
the SuperBuild Corp.
While working in the real
estate business, I constantly see the value of infrastructure
investments. When a young couple is buying their first home, the
answers to infrastructure questions help them to decide
where their families will live. What shape are the roads in, do
our kids have good schools, is quality health care close by?-when
I'm appraising real estate and putting a dollar figure on the
value of infrastructure to the community each and every day. This
kind of experience would help me make sure that taxpayers get
full value for SuperBuild investments, that we get the maximum
economic benefit and, in the long run, more new jobs.
Through my years in real
estate, particularly as president of the northern Ontario real
estate board, I have seen what it takes to attract new investment
to the north, and I've put that experience to good use on the
North Bay Economic Development Commission. Five years ago that
commission was a small group of only five people. We studied
economic development groups across North America and looked at
what was most successful. We found that cities with clusters
working to attract businesses in specific sectors of the economy
were the most successful. We adopted that approach, and now we
have more than 400 people involved and working towards employment
in our city.
In the past five years
since I was chair of the Economic Development Commission, North
Bay's unemployment rate has dropped from 13% to 6.5%. We have
built strong partnerships with many community leaders, including
our federal member, Bob Wood. My enthusiasm for and abilities in
economic development are well known across the north. That's why
so many economic development officers and municipal leaders have
endorsed me for this board, including Mayor Steve Butland of
Sault Ste Marie.
I know you are looking for
directors who have more than just one business experience; you're
looking for people who give back to the community. As president
of the Golf Northern Not-for-Profit Corp, I raised money for
underprivileged children. Last year I launched an annual
fundraiser for an important new addition to our city, the
proposed new general hospital. As well, I'm a Rotarian. I serve
on the board of the Foster-Wild Fund, which is run by the Mattawa
conservation authority. I'm past president of the North Bay
Crippled Children's Parents' Association. Just last week,
Coldwell Banker honoured me with its Canadian humanitarian award
for all my charitable work in economics and charities.
These experiences have
given me the skills and perspective that will help me serve as an
effective member of the SuperBuild Corp as we build the
infrastructure that will help businesses in Ontario to create new
jobs for years to come.
The Chair:
Thank you very much, sir. We will begin with the third party, Ms
Churley.
Ms
Churley: Thank you very much for this opportunity and
for agreeing to come and answer our questions today. This is a
highly partisan place, and you may consider some of my questions
intrusive. But I think they're important questions, because they
are related to your ability to serve the people of Ontario in an
objective and fair way.
I want to ask you about
your relationship with Mike Harris and the PC Party. I'm sure
you're not surprised that there are some questions around this.
It was reported in Maclean's magazine some time ago that you are
a good friend of the Premier, and I'd like to have your comments
on that. What is your relationship with the Premier of
Ontario?
Mr
Minogue: I grew up in North Bay, along with the Premier.
We went through school together, and a hundred or so other people
and myself are honoured to be friends of Mr Harris.
Ms
Churley: Can I ask you more specifically-because there
are certainly indications that you are somewhat closer to the
Premier than that. For instance, are you close enough friends
that you go fishing together? Were you at each other's weddings?
Can you give me some examples of your friendship with the
Premier? Are you one of a hundred or are you a closer friend?
Mr
Minogue: I grew up with him. We were very close friends.
We have the same interests. We do golf. We both fish. I think you
could say we are good friends.
Ms
Churley: So you have gone fishing and golfing with Mr
Harris. You consider yourself a good friend of the Premier.
Mr
Minogue: Yes, I do.
Ms
Churley: Have you or your wife ever run Mr Harris's
campaigns?
Mr
Minogue: I personally have not run any of his campaigns.
My wife does her own thing. She's very politically active and has
run his campaign the last couple of times.
Ms
Churley: But you personally have not?
Mr
Minogue: No.
1340
Ms
Churley: Were you approached to take this position, or
did you apply for it independently?
Mr
Minogue: I stay up on the news. Each morning I have the
Internet, I read the Toronto newspapers and I follow what is
happening. When I saw the SuperBuild fund being announced, I
thought that was an advisory board I could get on and be a good
addition to. I graduated from the University of Western Ontario
and majored in economics, and it was of real interest. As I
followed along and saw they were filling the board and realized
they were going to ask for someone from northern Ontario, I
thought that was an opportunity. So I asked for some support from
other people in northern Ontario-mayors and some of the economic
development people. I think they feel I'm a strong voice for the
north, or could be, and I put my name in to Mr Hudak.
Ms
Churley: So you weren't approached by anybody from the
government. You saw this position was available and applied for
it.
Mr
Minogue: Yes.
Ms
Churley: In terms of your resumé and the
description of your position on the board, how do you view your
responsibilities and duties to this job?
Mr Minogue: I have a background
in economics and business, as you read in my resumé, and in
working with people. This is an advisory board. There are 13
people on it, plus the CEO. I think there are different levels of
expertise. It's a very impressive list of people, some with
international qualifications, some with big banking experience. I
think I can add to this advisory board in my own way. I have
lived my life doing appraisals. I have looked at feasibility
studies, performance statements and financial statements. I've
been doing that for the last 20 years; not as big as they are
here, but I think the outcome is the same.
Ms
Churley: Specifically to your resumé, you say
you're the owner or part owner of seven Ontario corporations in
North Bay. Can you tell me what they are and also how you will
deal with possible or perceived conflicts of interest? By the
way, this question is being put to everybody, because a lot of
appointees to this board have a business background.
Mr
Minogue: I understand. Do you want to know the
names?
Ms
Churley: Yes. If you have them available that would be
good.
Mr
Minogue: There are four in the resumé-I'm sorry, in
my speech. There is Coldwell Banker Peter Minogue Real Estate, a
real estate company; Morland Real Estate Appraisals Ltd;
Callander Bay Developments, a large development company; Osprey
Links Golf Course. I have an investment company, 890242 Ontario
Inc. We invest in real estate. I have another investment company
that I work with and invest in the golf course with different
partners, and I have a holding company that pools all my
companies together under one ownership.
Ms
Churley: How do you think you would deal with a possible
conflict of interest should it arise?
Mr
Minogue: This is an advisory board. We don't actually
spend any money or vote or decide how money is going to be spent.
From what I've seen-and I haven't been to a meeting yet-we get
proposals for private-public partnerships, and we just make
recommendations to the Minister of Finance, which go to the
cabinet committee on privatization and SuperBuild. They make the
funding decisions. I understand it is very unlikely that there
would be a conflict. If there were, if I or my family would
somehow benefit personally, I would definitely declare a conflict
and remove myself from any discussion of what was happening.
Ms
Churley: Do you know very much about Highway 407 and the
terrible difficulties that deal has made for consumers who use
the road? Do you have any information about what happened there
and the fact that the private sector now is not releasing
information to the public, only to investors, and that the public
in fact may have tolls increased without knowing what the
threshold is? So we have a situation where the private sector's
making a huge profit at the expense of the people who are using
that highway and in my opinion, and in the opinion of many of the
public, that's a very bad deal-a good deal for the private
sector, but in this case a very bad deal for the consumers who
are using the highway. Do you have any comment on that?
Mr
Minogue: I've followed the news stories on the 407, saw
what was happening, that it was sold off to a private
organization, but other than that I've no information, details of
whether it's good or bad. If I get on the committee and we have
meetings and they discuss that, I'll certainly research and do my
homework on it. Really, I just have the news that's in the
newspapers, so I'd prefer not to make any opinion. I don't have
one.
Ms
Churley: This leads to the question around transparency.
I'm not opposed to public-private partnerships; I think they can
be negotiated so both benefit. There has to be a balance so that
the private sector can make a profit but the public is protected.
I think that needs to be a role of this board and I'm concerned
that what you and others are saying, that you see yourselves
purely in an advisory role and that you have no say in policy or
no say in making-obviously, I know you can't make final
decisions-and how these deals between the private sector and the
public sector are set up in such a way that the consumer is not
ripped off, which is what's happening with Highway 407 and
there's great concern that that's going to continue to happen.
I'm wondering what your comment is on that. What would you do to
make sure that didn't happen?
Mr
Minogue: Again, as a member of the advisory board, I
don't think we do have a say in it. One of the objectives of the
advisory board is to make things accountable. I agree that the
public should be able to see most aspects of a transaction or
partnership agreement. Right now, I'm serving on a special
committee of the city council of North Bay; we're doing our
waterfront redevelopment. It's probably about a $100-million
project, and in that we don't get to see the financial figures of
different companies, so whatever legislation says should be
revealed, I assume that's what would have to be done.
The Chair:
This is the last question.
Ms
Churley: OK, thank you. In your past experience, in
looking at your resumé, I wonder what you think your biggest
asset to this board would be?
Mr
Minogue: I've always been interested in economics, even
back in my college days; that's what I majored in at Western.
I've experience in economic development commissions. I'm the
chair of the North Bay Economic Development Commission; it's my
fifth year. I set up a regional economic development partnership
for the new Blue Sky region-if I'm allowed to advertise a little
bit, that's the new name for North Bay-that has 300 to 400
members. I'm the co-chair of that and have been for the last two
or three years. I've been involved in development myself-a
$10-million or $11-million land development and a golf course. My
day-to-day job is doing appraisals where I evaluate businesses, I
evaluate investments. I think that along with all that I have to
remain a strong voice to make sure northern Ontario and places up
there that are experiencing high unemployment get their fair share of
infrastructure money.
Ms
Churley: Thank you.
1350
The Chair:
The government party for five minutes. Mr Young.
Mr Young:
Thank you, Mr Minogue, for putting your name forward. Like many
of the others who have come forward to present themselves to this
committee this day, we should be honoured that we have people of
your calibre who are prepared to engage in this sort of public
service.
The comments you made
earlier understandably focused on northern Ontario, the near
north and beyond. Can you help us with some of the unique
challenges that might exist for North Bay and communities in the
north to ensure that there is an appropriate climate in place to
allow for the growth of business? What do you envision SuperBuild
Corp could do to foster and encourage that?
Mr
Minogue: The biggest problem in northern Ontario is
distance, distance between the cities for highways. There is a
lot of work required in the transportation sector to make better
highways and increase access back and forth.
One of the items in the
SuperBuild agenda is to increase or finance telecommunications
infrastructure. In North Bay alone in the last three years we
were fortunate enough to have fibre optic cables in North Bay
because the Department of National Defence gave us a jump-start
on the call centre business. We probably have between 1,500 and
1,600 jobs in the call centre business. It started up in the last
two or three years. So right now, with the global economy, with
the way telecommunications is going forward, it doesn't matter
where you are any more. If we can get fibre optics to Timmins,
they can have call centres there. If we can get it to Thunder
Bay, that's a growing industry, and up north we have to get
involved and get in the show.
Mr Young:
Sure. I have one more question. Mr Spina may have one of you as
well. The genesis of SuperBuild Corp goes back, I guess, to A
Road Map to Prosperity, which came out last year. It argued that
in order for this province to be globally competitive we were
going to have to engage in some significant capital upgrades. It
also submitted that we're going to need a partnership between the
private and public sector.
Again, drawing from your
northern experience, can you help us as to whether you think
there is a mindset, a climate in the north now in the private
sector to engage in that sort of development? Is there some level
of optimism that wasn't once there? Because I know for a fact
that in the past things have been pretty bleak.
Mr
Minogue: It's been difficult up north. We've had really
resource-based industries in most of the communities. But what
happened in public and private partnerships, I think the federal
government has been very successful in airports, in running them
together. North Bay airport was turned back to the city of North
Bay. It used to have a terrific loss. It's now operating at a
break-even point. It's difficult. I'm not sure how they're going
to get the private money, but there's an advisory board. That's
not quite our job. We can help to determine when private money
comes in how it will work or how to be creative and innovative in
its investing into the capital infrastructure, but it will be
difficult.
Mr Young:
Thank you.
Mr Spina:
Mr Minogue, thank you for coming before the committee today. My
question may be not unlike Mr Young's except that I want to take
it a notch further.
Part of the function of the
corporation is to devise financing mechanisms to leverage private
sector funding, or funding from other governments to pay for such
projects. Mr Young asked you a bit about whether you felt there
was enough private sector money perhaps in northern Ontario to
help with northern projects. I want to go a bit further into your
experience. You have quite an extensive background of setting up
businesses or launching projects, whether they be for a
commercial enterprise or whether they be for some charitable
projects. Do you feel that there's enough in the private sector,
not just in northern Ontario, but maybe within your scope, your
network of contacts, that could contribute and be interested in
working together with this provincial government to enhance
economic development for northern Ontario?
Mr
Minogue: I've just been appointed to the committee, Joe,
and I'm not sure where the private money is coming from. More
specifically, not northern Ontario but the 905 region, which I
understand is to double in population in the next 10 or 15 years,
needs utilities. They need new roads. They need sewers. They need
water. I'm sure that when you get to investing into that
proactively instead of after the fact, the private partners will
come. We're only an advisory board. To try to raise money, I love
doing it for charity, but I don't think that's part of this
board's mandate.
Mr Spina:
I wish you well.
The Chair:
The official opposition.
Mr
Phillips: Thank you for being here. This body is going
to be huge. It's going to essentially coordinate $20 billion
worth of spending. We were told this morning it will identify
other government things to sell off. This will control a huge
part of the construction industry over the next five years in
Ontario. It's massive. It will be coordinating every ministry-the
Ministry of Health, the Ministry of Education. It's absolutely
central to the Ontario economy and has the potential, in my
opinion, for a conflict. It really has to be seen as
independent.
The challenge here is,
you're a well-known friend of Premier Harris. There's absolutely
nothing wrong with that, and you should have every right to
perform whatever role that you want to in Ontario. The question,
though, is this: You are a well-known friend, and this body will
be having a huge influence in the next five years-huge. I'm
wondering why you would have applied for this and run the risk of
putting the Premier, at least, at risk. I'm wondering if you had
a discussion with the Premier, your local member, about your
application, whether
before or after you applied you'd had a discussion and had any
comment from him on the appropriateness.
Mr
Minogue: Thank you, Mr Phillips, for the question. I see
my role as more an advocate for northern Ontario. I know that
there's going to be a lot of money, and you're absolutely right.
It's a big spending amount. The construction industry is going to
be totally involved. I don't see where I'm going to get into a
conflict, though. We're an advisory board; we don't make any
decisions on spending or who gets contracts or where the money
goes. What I understand-I haven't been to a board meeting yet-is
that we'll get four or five proposals. We might say to the
cabinet committee on SuperBuild and privatization that we'd like
these three, and then the cabinet committee makes a decision.
As far as the Premier, I
specifically applied for the position without him knowing. I got
the support from northern Ontario. I thought that was important.
I approached Mr Hudak about whether they thought it was a good
idea. I have talked to the Premier since that time and he
basically said, "I think you have the qualifications, and good
luck."
Mr
Crozier: Welcome. You said just a few minutes ago that
you recently have been appointed to the board. I take it, then,
that you're totally confident, regardless of the process that
you're going through today, that you will be appointed to the
board. Is that correct?
1400
Mr
Minogue: I assumed I was appointed to the board, subject
to the standing committee approving it. I should have clarified
that.
Mr
Crozier: But you do have confidence that you are going
to be appointed to the board, I assume. OK.
We do have to be rather
sensitive, I think, when the public comes before this committee
to be appointed to boards and commissions. But at the same time,
we want to be absolutely sure there is no other influence on
decisions you would make or that any person on any other board
would make. So please understand that my comments are in that
context.
Of the other three we have
interviewed today, who will be appointed to this board, you are
the first to indicate that you have a bias for a particular
geographical area, in that you've said you are an advocate on
this board for the north. That leads me to believe you are
concerned about the economic development of the north. Are you
and Mike Harris currently partners, or in any way associated, in
any business ventures?
Mr
Minogue: No, sir.
Mr
Crozier: None whatsoever. Thank you. That reassures me
that your bias for the north will only benefit you and your real
estate business and not Mike Harris as well.
Mr
Phillips: I have a question on conflict. You indicated
that you don't see any risk of conflict on the board by yourself
and other members. I have quite a different view of it-not about
you but about the board-in that this is the board that companies
will be coming to with huge proposals. The board will be subject
to information that would clearly be of a privileged nature. The
board will have advance knowledge of projects. It is the board
that will be making recommendations to the government. I see this
board as rife with potential conflict, and I think board members
would want to have, before they went on the board, some idea of
how conflict was going to be handled and guidelines laid down. I
think there will be proposals coming to the board in which board
members will, unless properly directed, have an enormous
conflict. I'm quite surprised at your comment that conflict is
not an issue with the board because it is "advisory," that it's
really not a subject that has occupied much of your time and that
no one has gone over conflict guidelines with you.
I'd like an explanation
from you of why, with $20 billion-probably a lot more than $20
billion-worth of proposals coming forward, you wouldn't see the
board members being put into positions where they could be in
conflict.
Mr
Minogue: I'm sure we'll be sworn to secrecy, or whatever
the legislation requires, not participate in discussions in a
conflict situation. I know that when a proposal comes that is
going to affect North Bay or housing in North Bay, I would
probably declare a conflict. But as an advisory board, we don't
make the decisions on how to spend the money or where the money
is allocated. If these three projects look good to the Minister
of Finance, we don't have any say in how the money is spent.
Mr
Phillips: But the proposals come to the board. I'm not
saying you are in conflict, but billions of dollars worth of
proposals come to the board with privileged information, I
assume. It is the board that processes those and recommends to
the government.
I have a fundamental
difference of opinion with you. I think it is imperative, before
you go on the board, that there be an agreement on conflict and
that, on information that comes that is of a conflict nature,
there's agreement on what you will and will not discuss or see or
disclose. You are another board member who has said: "This is
just advisory. We don't need any guidelines. We don't need any
rules." It shakes my confidence, not in you but in the board,
that they are proceeding without that. I can see lawsuits. I can
see companies wanting to do business-spending $20 billion-and
board members feeling no obligation on the conflict side.
Mr
Minogue: I can't speak for other board members, but if
anything comes up where there is a conflict, where I or my family
could gain in any way financially-I'm on other boards where you
have to have a conflict declaration. If anything happens, you
declare the conflict and don't get involved in any
discussions.
The Chair:
That concludes the questions.
Mr
Crozier: I don't get one more little question?
The Chair:
Unfortunately for you, you don't get one more little
question.
Does anybody here have a
point of order they want to raise?
Mr Spina: I just want to ensure
that the comments Mr Crozier and Mr Phillips are making regarding
bias-in my opinion, having representation from someone from
northern Ontario does not constitute bias on a committee when we
try to ensure that we have people from all over this province
representing us in a fair distribution, in a fair manner. I just
want to clarify that.
Mr
Crozier: May I comment on that point of order?
The Chair:
Yes.
Mr
Crozier: I don't think I raised the question of bias at
all. In fact, it was the appointee who raised the point that he
would be an advocate for the north. I compared that to the
comments of the others who appeared for the board and didn't show
any geographical preference. Therefore, I assume they would be
all across this province.
Mr Spina:
The word he used was "bias."
Mr
Crozier: He later said that if a conflict of interest
arose, if something came up in the north, he would declare a
conflict. So there's a bit of conflict in his testimony before
the committee, that's all.
The Chair:
This is probably part of the discussion that would come when we
are making decisions on appointees. I thank the member for his
point of order and the member for his response to the point of
order.
Thank you very much, Mr
Minogue, for appearing before the committee. The decision on all
appointments today will be made when consideration of all
appointments has taken place. We have one more appointee and,
after that, members of the committee will discuss whether
appointees have been accepted.
SHEHNAZ ALIDINA
Review of intended
appointment, selected by official opposition party: Shehnaz
Alidina, intended appointee as member, Ontario Rental Housing
Tribunal.
The Chair:
The next appointee is Shehnaz Alidina, intended member, Ontario
Rental Housing Tribunal. Welcome to the committee. As you have
observed, an intended appointee has an opportunity to provide an
opening statement if he or she wishes.
Ms Shehnaz
Alidina: Thank you for the opportunity to make some
comments. I would like to begin by stating that I feel I am well
qualified to be a member of the Ontario Rental Housing Tribunal,
and I would like to offer three reasons. First, I think I have
the right academic background; second, I think I have the right
professional background; and third, I have personal qualities
that would make me a good adjudicator.
In terms of my academic
background, I have a bachelor's degree in occupational therapy
and a master's degree in health administration, as well as a
fellowship in health administration.
In terms of my professional
background, I have worked in the clinical planning and management
fields. As executive director of a district health council, I was
responsible for starting a new district health council, bringing
two districts together at a time of rapid change in the health
system. I also led the development of health system plans to find
local and meaningful solutions to health reform. I now work as a
health consultant, where I bring the Ontario experience and
technical know-how internationally. Over 15 years, and
particularly through my 11 years on the district health council,
I have developed the skills to interpret policy, gather
information and evidence, and make impartial decisions.
1410
Finally, in terms of my
personal experience, I feel that I work well with people. My
sensitivity comes from having experienced turmoil in my own life,
where I fled Uganda almost overnight as a refugee. As well, in my
international work I had the opportunity to work with countries
that are trying to rebuild their health systems after having
experienced political disintegration, economic collapse or civil
war.
I think these experiences
have strengthened my sensitivity to people and have also
strengthened my belief that people's needs and desires are the
same regardless of the social or economic background they come
with, and that it's very important that we listen to people
attentively and sensitively. I feel that these personal
qualities, combined with my professional skills, would make me a
good adjudicator.
The Chair:
Thank you very much. The government will begin, with seven
minutes.
Mr Spina:
Thank you, Ms Alidina, for coming forward for this position. It's
a difficult one at best, but you have an excellent track record
in this regard. Frankly, I'm disappointed that the media is not
here to hear your interview, as opposed to wasting time on a
perceived issue that they think may be in the works somewhere
else.
You have most recently been
involved with people overseas; is that correct? Or are you still
based in northern Ontario?
Ms
Alidina: I'm based in northern Ontario, but I do a lot
of international work.
Mr Spina:
OK, but you're out of the Soo?
Ms
Alidina: In Sudbury.
Mr Spina:
You're as travelled as I am. I was born and raised in the
Soo.
My question really had to
do with your perception of a comment made earlier. Do you think
that because you have had extensive time and experience in
northern Ontario, that would bring a particular bias to your
perspective on the rent tribunals?
Ms
Alidina: I believe that my role would be to represent
the interests of Ontario and to adjudicate fairly under the law.
Because I have lived in northern Ontario, certainly I would bring
knowledge of issues of northern Ontario, but I do not believe
that represents a bias.
Mr Spina:
Thank you. I wish you well.
The Chair:
I think Mr Johnson was next.
Mr
Johnson: I guess I'd feel more comfortable if I could
call you by your first name, but maybe that's improper. My point
is, it reminds me a little bit of that other famous person from
the north-but I think she's from Timmins, the singer, Shania. But that's
not the pronunciation of your name.
I wanted to comment on the
qualifications that you bring to the job, because we've been
given your resumé and so on. I notice a bias in health care,
so I'm wondering what made you seek out-or did someone ask you
about it?-the position in rental housing, because it's not
exactly your training. I'm interested in your comments on
that.
Ms
Alidina: I'll answer both questions. First, why the
housing tribunal: I've always been interested in service. It's
something I've grown up with as a teenager, and also as an adult,
and have always given service in one form or another. I strongly
believe in the value of public service. I also believe in the
broad determinants of health, and housing is an important
determinant of good health. I'm also very concerned about
fairness to people, and that is why the tribunal was of interest
to me. That's the first question, why housing.
Second, in terms of my
application, I was very interested in serving on a board. I did
some research and zeroed in on the Ontario Rental Housing
Tribunal for those reasons. I contacted the executive director of
the tribunal, received a package of information and subsequently
made an application to the tribunal. When the executive director
was in Sudbury, he met with me and we had a preliminary
discussion. He felt that I met the qualifications for an
interview, and subsequent to that I was called for a written and
an oral interview in Toronto in January.
Mr
Johnson: It was definitely the link, if you like,
between health and housing that I was looking for. Thanks very
much for including that in your remarks.
Does someone else have a
question? We would reserve the rest of our time, then, until
later if we need it.
The Chair:
I don't think you're allowed to reserve it, so if you want to use
it-
Mr Young:
I had a question if time permitted, and it appears that it
does.
First of all, as I have
said to the other individuals who have come forward today, I do
appreciate your coming forward. I don't think it's fully
understood by some the personal sacrifice that is made by
individuals who bring themselves forward and expose themselves in
a sense to the public. Generally, the people who occupy the seat
that you are in have a great deal going for them and don't need
the appointment in order for their life to be viewed as
successful by themselves or others. You certainly fit within that
category.
What I would ask you to
comment on if you would, Ms Alidina, is the process itself. Do
you have some notion and perception of the particular workings of
the tribunal to date? Have you had some involvement in and
understanding of the manner in which it works? I would ask you to
answer that if you would, bearing in mind your own experiences
and how you think that would benefit you in being an adjudicator
at that tribunal.
Ms
Alidina: I certainly have received and reviewed a great
deal of information on the tribunal and its workings, as well as
having discussions with the executive director of the tribunal in
terms of how the tribunal operates.
Mr Young:
That's fine. Thank you, Mr Chair.
The Chair:
To the official opposition, Mr Crozier.
Mr
Crozier: Welcome to the committee. I appreciated your
comments at the outset in outlining what I agree are exemplary
qualifications for this particular appointment. Contrary to what
Mr Spina was referring to as any bias, you didn't show that you
were particularly advocating for any geographical or citizen area
of the province, and I appreciate that.
You have applied to what I
consider to be a very, very sensitive position, and I am sure
that in your research you had determined that before you applied,
in that there has to be a delicate balance between the rights of
renters in this province and the rights of landlords or owners,
so between landlords and tenants.
But an area that concerns
me in particular is the Tenant Protection Act as it applies to
care homes: nursing homes, rest homes, retirement homes. I wonder
if in your research you have had an opportunity to look at that
particular area as the landlord and tenant acts apply, and if you
have any comments.
Ms
Alidina: Certainly I have read the legislation. I don't
consider myself to be an expert on it, because I haven't been
through my training-
Mr
Crozier: I understand.
Ms
Alidina: My impression of the act is that it's a very
balanced piece of legislation, that it looks at the rights and
obligations of tenants as well as the rights and obligations of
landlords and tries to balance them both.
Mr
Crozier: When I speak of care homes, and I could have
given you an opportunity to think about this a bit more, what
happens is that the act provides that a care home can in
effect-although I think "evict" is a strong word-ask a tenant to
leave because the care home no longer feels they can provide
whatever it is the tenant needs, either increased care or perhaps
even a level of decreased care. Knowing that, I feel from what
you have said so far that you will in those instances give very
careful consideration when it comes to the elderly and the frail,
as opposed to, let's say, a rental disagreement in downtown Essex
where someone simply hasn't paid their rent or hasn't treated the
property with due care and diligence, that when it comes to our
frail and elderly, the act will be applied very judiciously if
such a request should come to your tribunal and under your
review.
Ms
Alidina: I think the act really does protect the rights
of tenants and states under what provisions, what circumstances,
a tenant can be evicted. I think the act is very specific, and I
feel the act is also quite equitable. For example, section 84 of
the act allows an adjudicator to decline an order for eviction or
postpone it if extenuating circumstances warrant that. I feel
that my role as an adjudicator would be to make sure that both
interests are served fairly under the law.
1420
Mr
Crozier: I appreciate that very much and I like to hear
that. I'm sure that when this process is finished and you're appointed to this
board, you will do exactly as you've said, so thank you.
The Chair:
There would be no more questions from the official opposition, so
I will go to the third party.
Ms
Churley: I am impressed by your background and
resumé here. Hopefully, at the end of the day you will get
this appointment. Thank you for wanting to take it on.
Here in Toronto, in the
riding which I represent, Broadview-Greenwood, which is not far
from downtown, we are seeing close to a crisis, if not a crisis,
in housing with the rent decontrol. Once people move out of an
apartment, as you know, the rent can increase to whatever the
landlords want it to be. I believe about 80% of renters move
within a five-year period of time, so it's quite a difficult
problem. There are more homeless, and thousands and thousands of
people are on the waiting lists for subsidized housing.
I know the tribunal doesn't
deal with these policy issues, but I'd like to know what your
overview is on what we should do. What advice would you give all
levels of government and legislators in general as to what we
should do about the problem we have in housing right now?
Ms
Alidina: As you mentioned, I'm not a legislator; I'm not
in the business of policy-making. I would see my role presently
as being in terms of acting very fairly and making sure the
interests of the tenant as well as the landlord were adequately
represented and that a fair and sensitive decision was made.
Ms
Churley: Some of the reports I hear-and no doubt you
might be getting some of these kinds of cases. I think there are
a lot of good landlords out there, but there are some bad ones
too. I've certainly had people report to me that people of colour
and single parents with children on welfare have been turned
down-not blatantly. But very clearly, once you read between the
lines what happened, there is some discrimination from some
landlords out there. I am wondering if you have a comment on
that.
Ms
Alidina: I don't at the moment, although I'm looking
forward to beginning work with the tribunal if my appointment is
approved and learning more about the issues.
Ms
Churley: So you've heard a little bit about some of the
things going on out there, I assume.
Ms
Alidina: I read the news.
Ms
Churley: So at this point that's your only awareness of
some of the issues out there? OK. Thank you very much for coming
forward today. I appreciate it.
Ms
Alidina: Thank you very much.
The Chair:
That appears to be the final question that's being directed to
you. Thank you very much for coming before the committee. As I
explained previously, the committee makes its decisions at the
end of the day, but you are now excused. We thank you for coming
here, and I can tell you that anybody from Sudbury has to be very
good.
Ms
Churley: Is the Chair allowed to show a bias like
that?
The Chair:
I can show a bias toward my place of birth any time I want
to.
Interjection: As can the people of
St Catharines.
Mr
Crozier: Between Sault Ste Marie and Sudbury and Essex,
we're doing OK.
The Chair:
We have concluded the questioning of the various people, and now
we go through the appointments one by one. You have permitted Ms
Churley, through the benevolence of the committee, to be a voting
member. For the Liberal Party, Mr Crozier is a voting member, and
I believe Mr Phillips would be a voting member. But I will go
through each of these at the present time to see whether we
concur in the appointment. I'll accept a motion as we go through
them.
The first one we have is Mr
Frank Potter, intended appointee as vice-chair, Ontario
SuperBuild Corp board of directors.
Mr Young:
I move that Mr Potter be appointed to that position.
The Chair:
It's moved by Mr Young.
Ms
Churley: Can we have a recorded vote?
The Chair:
We will. I can ask for any comments as well, but we have the
motion before us. Any comments by members of the committee?
Mr Young:
If I may in support of my motion, Mr Potter came forward and
presented both in writing and in person as an impressive
individual with an extensive background not only within this
province but internationally. He brings to the table experience
in a number of different manners but particularly with reference
to similar joint public-private partnerships. I think he would be
an excellent member of the SuperBuild Corp.
The Chair:
Ms Churley, did you have a comment or were you simply asking for
a recorded vote?
Ms
Churley: Yes, I was just asking for a recorded vote.
The Chair:
OK. We will now call for the vote on Mr Young's motion to concur
in the appointment of Mr Frank Potter.
AYES
Crozier, Johnson, Spina,
Young.
NAYS
Churley.
The Chair:
The motion is carried.
The next appointment we
will consider is that of Diane Beattie, intended member, Ontario
SuperBuild Corp board of directors.
Mr Spina:
Mr Chair, I move concurrence for Ms Beattie.
The Chair:
Any debate? Do you want a recorded vote on all of these, Ms
Churley?
Ms
Churley: Not on this.
The Chair:
OK.
Mr
Johnson: I do.
The Chair: Mr Johnson would
like a recorded vote.
AYES
Churley, Crozier, Johnson,
Spina, Young.
The Chair:
The motion is carried.
The next is Mary Mogford,
intended as chair, Ontario SuperBuild Corp board of
directors.
Mr
Johnson: I move concurrence of the appointment for Mary
Mogford.
The Chair:
Mr Johnson moves concurrence. All in favour? Opposed?
Ms
Churley: Recorded vote.
The Chair:
A recorded vote is requested. It should have been requested
previous to this. Before each motion there is a recorded vote
requested, so unfortunately you were too late for that.
The motion was carried for
Ms Mogford.
Donald D. Weiss, intended
member, Ontario Public Service Pension Board.
Mr Young:
I will move concurrence for this appointment.
Ms
Churley: A recorded vote, please.
The Chair:
You wish a recorded vote. Is there any debate? OK.
AYES
Johnson, Martiniuk, Spina,
Young.
NAYS
Churley, Crozier.
The Chair:
The motion is carried.
The next is Peter Minogue,
intended as member, Ontario SuperBuild Corp board of
directors.
Mr Spina:
I move concurrence, Mr Chair.
Ms
Churley: Discussion before we vote?
The Chair:
Yes.
Ms
Churley: I just want to say for the record that I'm
voting against this appointment. I have real concerns about what
appeared to me the inadequacy in responses around Mr Minogue's
friendship with the Premier.
Not just in this case but
throughout the interviews-I want to put this on the record-I was
somewhat dismayed by the general responses to questions,
particularly from the opposition, around conflict of interest and
perceived conflict of interest, and an understanding of the
importance of the role that this board will be playing in terms
of dealing with multi-billions of dollars and doling out huge
amounts of cash, and the influence that they in fact will have,
be it formal or informal.
I would like to say for the
record that I hope the Premier's office-I don't know if I can
make such a motion or not, I'm not part of the committee, but
perhaps this committee should be asking the government to come up
with conflict-of-interest guidelines and a more concrete, I
suppose, outline of the duties and responsibilities of this
board. Although it seemed fairly clear to me, the people we
interviewed didn't seem to have a clear idea of how important
their role is going to be and what influence they actually will
carry.
I don't know that it's
appropriate for me to ask the committee for that kind of thing.
Can I have your advice on that?
1430
The Chair:
You could probably ask the committee. They may or may not agree
with you. Certainly one thing that can be said is that your
remarks have been recorded in Hansard for all to read, but I
suppose I could at least entertain a motion which would ask our
committee to ask something of another committee, and the clerk
will advise me on the acceptance of such a motion, whether it's
in order or not.
Mr Young:
On a point of order, Mr Chair: Is it appropriate for that motion
to be put on the table as we're approaching a vote after a
concurrence has been moved?
The Chair:
No, it would not be, so I think you're looking for clarification
of whether you could move such a motion. It would not be, at this
point in time.
Ms
Churley: So it would be after we take the vote?
The Chair:
It would be after the vote.
Mr
Crozier: Just a few comments to add to Ms Churley's,
because my colleague Gerry Phillips, of course, in his
questioning met with much the same response, particularly when it
came to conflict of interest.
Also, when Ms Churley
mentions the role of the board and its perceived role as pointed
out by the members who appeared before us today, as an example,
it appeared as though there was confusion as to whether the chief
executive officer of the SuperBuild Corp would in fact have to
bring before the board any of his recommendations, or whether
they could go directly to cabinet. There seemed to be, at least
on the part of one of the attendees this morning, some
uncertainty as to whether that had to be the case. In fact, it
was said that the chief executive officer may not even have to do
that. I found that amazing, that someone who was being appointed
to a board would agree that a CEO of the SuperBuild Corp wouldn't
have to bring a proposal before the board. I think that's the
kind of thing that should certainly be defined when it comes to
the board itself.
When it comes to this
particular appointment, I said during my comments that we have to
be rather sensitive, but I frankly feel that of the three other
appointees we brought before the board, and indeed in those
others that are listed in the information we received from the
research officer, this particular individual has the least
qualifications, by far, of all. I am concerned that the most
outstanding qualification he has is that he's a close personal
friend of the Premier's. I am surprised that there are not many
others in the province who would have the same list of
outstanding qualifications as do the other appointees to the
board. In a few words, I think and will state that we simply
could have found someone better.
The Chair:
Any other debate?
Mr Johnson: I just wanted for
the record to put my comments in regard to this intended
appointee. The observation has been made that he's the least
qualified except for his friendship with the Premier. Quite
frankly, I would like to dispute that as either an observation or
a fact. Indeed, he brings an extensive background in real estate
to this board, and I would hope we would look at his friendship
with the Premier, if indeed it's still as current as what he
would like-that we don't use that as a reason to eliminate a
representative from that geographic area of the province that
seems to be somewhat isolated geographically from what we think
of as the centre of the universe here in Toronto. I just wanted
to state my objections to that sort of observation.
The Chair:
I'll go to Ms Churley and then Mr Young.
Ms
Churley: I want to say in response to Mr Johnson, and
again for the record, that there are certainly circumstances
where I think it would be a shame for people with the right
qualifications who have close connections to the Premier or
indeed any other members of the government to be shut out of
public service. Having said that, I believe it is incumbent upon
the government, particularly when they put forward somebody who
is a documented close friend of the Premier, that that person
have impeccable qualifications for the job. In this case, those
qualifications aren't there. This is indeed, as Mr Crozier said,
the least qualified of all of the applicants, and this is not a
direct attack on the applicant. I believe to some extent it's
incumbent upon the government as well, if they're going to be
appointing good friends of the government-and we know that of
course with the majority here today it will pass-that the
background and abilities and experience brought to the particular
board are impeccable, and in this case they aren't. It seems
clear that in fact his greatest asset to this job is that he's a
close friend of the Premier. I don't know there's any way around
that. You just have to check the resumé and compare it to
others.
Mr Young:
I will be brief, but I feel compelled to make a few comments. I
was pleased to hear the members of the opposition and the member
of the third party acknowledge that one's friendship to an
elected official should not in and of itself prevent that person
from coming forward to hold public office, and I appreciate their
suggesting that if the qualifications are there, then that
candidate should be considered.
Certainly in the case of Mr
Minogue, I guess we all read things with different-coloured
glasses on, but I read his resumé and I heard his answers as
being complete. I read his resumé as being such that he has
a background in a number of different areas, including education,
including economics, including real estate. I read his
resumé as one where he has done a great deal of charitable
work and apparently been very successful at it. And I read his
resumé and take from his comments that he is recognized
within the city of North Bay as being one who has a great deal to
offer and that's why he has recently been so involved in the
economic development committee. The results are quite impressive,
frankly.
In closing, I also want to
note that Mr Minogue, albeit that he knows the Premier, admitted
that he knows him fairly well, also, and unfortunately there has
been very little mention of this, was endorsed, as I understand
it, by the mayor of Sault Ste Marie, Steve Butland. My
understanding, subject to correction from the other side of the
table, is that Mr Butland actually sat in the House of Commons as
a member of the New Democratic Party for a period of time. Surely
in the case of Mayor Butland, he recognizes that Mr Minogue
brings other skills and abilities forward, as does the city
council or whoever appointed him to the economic development
committee. I think we have to look at the entire package. We have
to look at his accomplishments, not simply one aspect of his
friendships. So I will be voting in favour of Mr Minogue.
The Chair:
Any other debate? If not, we will call the motion.
Mr
Johnson: Can I have a recorded vote?
The Chair:
Recorded vote requested by Mr Johnson.
AYES
Johnson, Martiniuk, Spina,
Young.
NAYS
Churley, Crozier.
The Chair:
The motion is carried.
The final intended
appointment we will consider is that of Shehnaz Alidina, who is
the intended member, Ontario Rental Housing Tribunal.
Mr
Johnson: I'd like to move concurrence.
The Chair:
Any debate? All in favour? Opposed? The motion is carried.
We don't have any further
business, Mr Clerk, do we? Go ahead, Ms Churley.
1440
Ms
Churley: I understand you need a written motion, and I'm
trying to do that now.
I move that the standing
committee on government agencies request that the Office of the
Premier provide this committee with written conflict-of-interest
guidelines to apply to the members of the Ontario SuperBuild Corp
board of directors.
The Chair:
Mr Young.
Mr Young:
I have some reluctance in dealing with this at the present time,
particularly because, as I suspect the members opposite know,
each board-not only the SuperBuild Corp but each board-will be
establishing or is obliged to establish conflict-of-interest
guidelines, and they're obliged to configure those guidelines
essentially the same as or premised upon those we operate under
as MPPs and that public servants generally do. I'm reluctant to
entertain, at this late hour, a motion that's only going to be
somewhat superfluous and add very little if anything,
particularly until we have an opportunity to see what the
SuperBuild Corp does on its own. As I indicated, they are obliged to, if they have not
already, create their own conflict-of-interest guidelines.
The Chair:
Any other comments on this? Mr Martiniuk.
Mr Gerry Martiniuk
(Cambridge): Mr Chair, I ask you to direct your mind and
consider whether in fact this committee has jurisdiction to
debate a motion of this kind. I suggest that it is out of order.
As I understand, the jurisdiction of this committee is to
evaluate individuals who have been or are proposed for
appointment to particular boards. This motion sets up a number of
rules or possibly a constitution for governing a board of
directors, a crown agency, in effect, and I think it goes far
beyond the accreditation of individuals who appear before us. It
is, in fact, a policy matter for the government and not a matter
for this committee.
The Chair:
Thank you. I'm going to hear Mr Johnson's comments if I may.
Mr
Johnson: No comment. He said it all.
The Chair:
Does anybody else want to make a comment? Before I rule on
whether it's in order, I'd like to hear whether the committee
thinks it's in order and then I'll make a ruling.
Ms
Churley: I honestly don't know. It may be out of order,
and you'll have to rule on that. I made the motion simply out of
concern over my stated objections earlier on the answers to
questions around conflict of interest from the candidates today.
I thought this might be a good way not only to get those concerns
on record but to bring those concerns to the Premier's office and
have him aware that there is a concern by this committee that
there seems to be a gap in understanding the important role of
this board and, in fact, the very large conflict-of-interest
problems or perceptions of conflict of interest that could arise.
That's why I placed the motion. If it's out of order, it's out of
order, but perhaps there might be a way to get at it in another
forum.
The Chair:
I will now deliberate with myself and with the clerk and
determine whether we believe it to be in order.
I'm going to rule the
motion out of order at this time, and I'll give a brief
explanation of why. When the House is not in session, the
committee is permitted to meet only for the purposes of dealing
with intended appointments and not other business. It may well be
in order when the committee meets to discuss whether it's going
to deal with agency reviews, and that happens when the House
returns. The House is scheduled to return on April 3, so if the
member wishes to bring a motion at that time, we can determine
whether it's in order, but at this time, because of the narrow
mandate that we have when the House is not in session, I will
rule the motion out of order.
Ms
Churley: I'll certainly accept that ruling and I will
relay to the NDP member of the committee, Mr Tony Martin, that he
will have the option to bring a similar motion back after April
3.
The Chair:
Any other business for the committee? If not, I will entertain a
motion of adjournment, moved by Mr Spina. All in favour? The
motion is carried.
