Legislative Assembly of Ontario

REFERENDA

CONTENTS

Wednesday 4 December 1996

Referenda

STANDING COMMITTEE ON THE LEGISLATIVE ASSEMBLY

Chair / Président: Mr Ted Arnott (Wellington PC)

Vice-Chair / Vice-Président: Mr John Hastings (Etobicoke-Rexdale PC)

*Mr TedArnott (Wellington PC)

*Mr RickBartolucci (Sudbury L)

*Mr DaveBoushy (Sarnia PC)

*Mr TonyClement (Brampton South / -Sud PC)

*Mr CarlDefaria (Mississauga East / -Est PC)

*Mr BillGrimmett (Muskoka-Georgian Bay / Muskoka-Baie-Georgienne PC)

*Mr JohnHastings (Etobicoke-Rexdale PC)

Mr RonJohnson (Brantford PC)

*Mr FrankMiclash (Kenora L)

*Mr Gilles E. Morin (Carleton East / -Est L)

*Mr John R. O'Toole (Durham East / -Est PC)

*Mr TonySilipo (Dovercourt ND)

Mr R. GaryStewart (Peterborough PC)

*Mr BudWildman (Algoma ND)

*In attendance /présents

Substitutions present /Membres remplaçants présents:

Mr Jerry J. Ouellette (Oshawa PC) for Mr Stewart

Also taking part /Autres participants et participantes:

Mrs SandraPupatello (Windsor-Sandwich L)

Clerk / Greffière: Ms Lisa Freedman

Staff / Personnel: Mr Philip Kaye, research officer, Legislative Research Service

The committee met at 1537 in room 228.

REFERENDA

The Chair (Mr Ted Arnott): We are resuming our discussions and are actually in the process, hopefully, of writing our report to the Legislature on the issue of referenda.

All members of the committee have in front of them two documents that Philip Kaye, our research officer, has prepared. One is answers to questions that were raised at the last committee meeting and the second is Issues and Options re: the Committee's Report on Referenda, which is the framework paper to the discussion that we're going to attempt to engage in this afternoon, again working towards giving Philip the direction he needs to write the report for this committee.

I would turn now to Philip and ask him to give a brief overview of what this paper's all about.

Mr Philip Kaye: As members are aware, a few weeks ago I prepared a framework document highlighting various issues the committee may wish to consider when giving instructions for the drafting of the report on referenda. That document contained about three pages of questions for the committee to consider.

In the document that members have before them entitled Issues and Options re: the Committee's Report on Referenda, I have taken those three pages or so of questions and incorporated them in another paper which contains much more detail. This more detailed paper contains almost all of the questions in that previous memo with a few changes which I've noted at the bottom of page 1.

The first change I wish to bring to members' attention deals with the concept and scope of referendum legislation. Previously, the framework memo under item 1 asked two things: "Should there be legislation authorizing the holding of provincial referenda, and if so, on what subjects should referenda be permitted?" I've divided that question into two parts so that the first part remains under the current question 1: "Should there be legislation authorizing the holding of provincial referenda?" But the second part of the old question 1 dealing with the subjects of referenda is removed from the question because the issue of subject matter is raised in subsequent questions, in particular questions 4, 7 and 9, and those questions deal with discretionary referenda, mandatory referenda and citizens' initiatives, because in looking at those kinds of referenda it's necessary to ask what subjects should they or could they deal with. So that's the first change between this paper and the previous one.

A second change I've noted has to do with the issue of recall, which I've moved from the category of citizens' initiatives to political and electoral reform. You will notice that a question on recall is now found in question 33 on page 15.

Two other changes involve the addition of questions as a result of comments made during the last two committee meetings and a further review of the summary of the recommendations made to the committee. Those additional questions pertain to the cost of referenda and the issue of ensuring the constitutionality of the ballot questions.

This more detailed document is intended to be read with the summary of the recommendations made to the committee, and under the various questions you'll notice "see" references to the relevant pages of the summary.

To assist the committee in its deliberations, I've highlighted the questions. Not only have I numbered them, I've put them in boxes with shading, and following the questions, in addition to the "see" references, I list various options for the committee to consider.

If the question simply asks for a yes or no answer, there's nothing provided under options, but if more is required, then members will notice that a series of options is listed. The options are not meant to be exhaustive, so members of course are free to suggest other alternatives.

Similarly to the framework document, this paper, unless it otherwise says, uses the word "referenda" in a very broad sense to cover binding votes, non-binding votes and also citizens' initiatives. The question of whatever way the referendum was initiated is not an issue, so the term is used in a very general sense.

I think that basically gives an overview of the structure of the paper with, as I said, options listed under some of the more significant questions.

The Chair: Thanks, Philip. Does anybody have any questions of clarification on this paper? Does every member of the committee have a copy of this Revised Summary of Recommendations re: Submissions on Referenda? Lisa's handed that out for everybody. You may need it to follow along.

What I intend to do is to proceed going through this paper that Philip has provided and have a discussion on each point. I'll read out the question that he's raised, and members will have an opportunity --

Mr Tony Clement (Brampton South): There's a second memorandum dated December 4 regarding court references. Is that worthy of comment by the researcher?

The Chair: Do you have questions about that? It was in response to some of the verbal questions that were raised at last week's meeting. Philip, do you want to explain?

Mr Clement: Maybe you could give us the Reader's Digest version of it, because we won't have time to read it.

Mr Kaye: There were two questions raised at the committee's last meeting. The first one asked: Have provinces ever referred issues of minority rights to their supreme courts? Beginning on page 2, I note that several provinces indeed have referred issues of minority rights to their courts, particularly with respect to French language education rights. Currently in Ontario the power of the provincial government to refer matters to the courts is found in the Courts of Justice Act which contains a provision that reads, "The Lieutenant Governor in Council may refer any question to the Court of Appeal for hearing and consideration."

The other issue that was raised last week was whether or not there had been a court case involving limits on third-party advertising, and the Charlottetown accord where the National Citizens' Coalition may have been a party. I wasn't able to locate a case involving all those factors, but there were two cases which involved some of them.

The first one is noted at the bottom of page 3. It's a case pertaining to the Canada Elections Act, where the restrictions on third-party advertising were in issue, and that restriction is mentioned at the top of page 4. There were various provisions challenged in this court case, which was launched by David Somerville on behalf of the National Citizens' Coalition as well as on his own behalf. The restrictions in the Canada Elections Act which he challenged prohibited all advertising in relation to an election during a specified blackout period. They also restricted third parties, namely, all persons other than political parties and candidates, from spending more than $1,000 on advertising which promoted or opposed a particular party or candidate.

The Alberta Court of Appeal in June 1996 dismissed an appeal from the decision of the trial judge which had ruled that these provisions were contrary to the Charter of Rights. The Alberta Court of Appeal held that each of the restrictions violated the guarantees of freedom of expression and freedom of association in the Charter of Rights. In addition, the court held that the restrictions on third-party advertising obstructed citizens' access to information to such an extent that the right to cast an informed vote under section 3 of the charter was violated.

The other case highlighted in the memorandum involves Quebec's referendum legislation. Robert Libman, former leader of Quebec's Equality Party, has launched a court challenge against sections in Quebec's referendum legislation dealing with regulated expenses. The provisions in question state that during a referendum only a national Yes or No committee may incur or authorize expenses to promote one side or another. During the referendum on the Charlottetown accord in 1992, Libman wished to run his own campaign rather than campaign under the leadership of the official Yes and No committees. This action against some provisions in Quebec's referendum legislation went before two levels of court in Quebec and is now before the Supreme Court of Canada.

Just a few weeks ago the Supreme Court issued formally the two questions which it would decide upon. They are summarized at the top of page 5, the first one being, do certain provisions on the regulation of referendum expenses in Quebec violate in whole or in part section 2(b), dealing with freedom of expression, and/or section 2(d), dealing with freedom of association in the Charter of Rights; and secondly, if they do, do these provisions or any of them constitute a reasonable limit prescribed by law under the charter? in which case they would be upheld.

The federal government decided within the past week or so not to intervene in this case before the Supreme Court of Canada. There's a quote from Justice Minister Allan Rock in footnote 12 at the bottom of page 4 of the memorandum, where he's quoted as saying, "We didn't think there was anything we could add, so we're not going to take part."

The Chair: Thank you, Philip.

Mr Jerry J. Ouellette (Oshawa): In regard to the verification of signatures to ensure that they are voters and that there's not duplication of signatures from various locations that occur with the petitions that come forward, is there anything to be discussed in that matter?

Mr Kaye: There isn't any specific question on verification because I've tried to keep this paper to the more general issues, but that's certainly an issue the committee may wish to provide guidance to me on in drafting the report.

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The Chair: Let's see if we can get started. The first question that Philip has posed, on the first page, is, "Should there be legislation authorizing the holding of provincial referenda?" Discussion?

Mr Gilles E. Morin (Carleton East): If you'll recall, at the last meeting we had, in November, we had asked for a delay so that we could consult our caucus, which we did. We had a lengthy discussion and there was a lot of participation, which really pleased me, because quite a few members, in my opinion, at that time had not gone far enough.

The position we want to take is that we agree in principle with the referendum except that in order to proceed and to debate it further, we would ask the following: If we are to hold referenda, we should organize a tripartite committee -- and that committee, of course, would be formed by all of us -- and it has to be, when it comes the time to make a decision, a unanimous decision. There's no choice other than to have a unanimous decision. If it doesn't work that way, if it's not acceptable, we'll submit our own report.

I'd like to put a motion immediately, if you're agreeable to that -- and maybe you could phrase it, Lisa, for us -- that a tripartite committee should be formed -- I think you understand my question -- and that whenever a decision is made to hold a referendum it should be unanimous. It should not be left to the government to decide if a referendum should be held on a certain issue but the decision should be made by the three parties. We can only operate on that. We're willing to go ahead and hold discussion as long as you agree with that.

The Chair: Mr Morin has made a motion and Lisa's furiously writing it down here. Discussion on the motion?

Mr John O'Toole (Durham East): Mr Morin, is your recommendation with respect to this process or once we've agreed that a referendum is a valid process? We're going through a series of defining "referendum" and the process. Is your resolution respecting, once we've made that decision, what would the subject and conditions be any time there was to be a referendum?

Mr Morin: The agreement with my caucus is that if we are to proceed on discussions, submitting a report on referenda, a committee should be formed and that whatever discussion is held on referendum is done by the three parties and it's got to be unanimous. Is that clear?

Mr O'Toole: So it's the whole process?

Mr Morin: Let us say a decision is made to call a referendum on closing hospitals or raising taxes. It is a three-party committee that will decide. I hope I make myself clear.

Mr O'Toole: Let me just rephrase my question. I feel that what we're doing here is determining what are the issues that could be brought in a referendum, whether right of recall, all those other subsequent -- right now, we don't have a referendum process.

Mr Morin: I agree.

Mr O'Toole: What you're talking about to me is not allowing this very discussion to take place.

Mr Morin: Until such time as my motion is accepted. If it's not accepted, then we will proceed with our own report ourselves.

Mr O'Toole: Okay, thank you.

Mr Clement: I'm just trying to get some clarification on the Liberal position on this issue. None of the deputations we had listened to had suggested a format similar to the one that has been expressed by Mr Morin, so I just need a bit of clarification on what exactly this means. Does this mean that there would be no mandated referendum issues, that any referendum issue, before it ever got to a referendum, had to go through this process? Is that the intention?

Mr Morin: The tripartite committee, correct. It's got to be unanimous.

Mr Clement: I see. Does that mean also that there would be no citizen-initiated referendum through a collection of signatures or petitions that would be available to citizens unless it also was agreed to by a tripartite --

Mr Morin: If the tripartite committee decides that a referendum should be held, then of course the citizens would be consulted. In other words, what I'm saying is that one of the difficulties we've encountered is that if you need 10% of the population to agree that a referendum should be held, if you go, for instance, to northern Ontario it's a totally different story. You don't have the representation there. What we're afraid of is that you may limit it only to certain sectors of the province, and we don't agree with that. With a tripartite committee, in other words, the committee decides if it's unanimous consent to hold a referendum. It's the committee that decides to do it, and the committee in reality is representatives of the Legislature, but it should be held by the committee.

Mr Clement: Just one further question. I'm just trying to think this through so that I understand the position precisely. We were talking at our last meeting a week ago, throwing some ideas out. One of the ideas on the table, and I believe it was expressed in some of the deputations to this committee, was that there would be, either through the court system or through some form of independent commission, an opportunity for a 100% non-government-controlled entity which would ensure the question in a referendum to be valid, fair and balanced, and to ensure perhaps that the course of conduct within the referendum meets the principles of a modern democracy. That would be the stage at which there would be, I suppose, a check and a balance on unrestricted governmental fiat in this particular area. But you're not talking about that. You're saying that even before we get to that stage there would have to be a tripartite, as you call it, committee that would be deciding yes or no in terms of a referendum going forward?

Mr Morin: Yes, that's it.

Mr John Hastings (Etobicoke-Rexdale): Mr Morin, do you think that we'd have some terms of reference for this proposed tripartite committee that you're laying out? Would it mean there had to be total unanimity on any item of what would be the subject of a referendum or the financing or the whole beeswax, so to speak?

Mr Morin: That's correct. In other words, a referendum would not be held if you didn't have unanimous consent from the three parties. That's what I'm saying.

Mr Hastings: On anything?

Mr Morin: On anything.

Mr Hastings: I find that absolutely intriguing. Do you have any models from other places in the world where that type of --

Mr Morin: No, I don't. Ontario could be unique in that sense. We find that it is a very important tool to use. If it is agreed by the three parties, then we go ahead and we have a referendum on whatever the issue is.

Mr Hastings: So you have no other model? It's just something that you've come up with?

Mr Morin: No, but we could create one if there is none.

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Mr Tony Silipo (Dovercourt): I don't know if this will help or not, Mr Chair, but if we're speaking to the motion that Mr Morin has put forward, I would have to say, with all due respect, that I would disagree with it. There is certainly a lot of merit to questions being put to referenda having the agreement of however many parties are represented in the Legislature at any given point in time, in terms of the process and in terms indeed of the wording. That would be very wise, and when we get to the point of discussing how that should be done, I will certainly want to make some points emphasizing that even in cases where the government brings in a proposal for referenda there should be a process for discussion and approval by the Legislature prior to that happening.

I hope that will meet with the direction the government members want to go in, because I think it will be useful to air out potential problems that there might be with the suggested question, wording etc. In that context, even the kind of suggestion Mr Morin is making around potentially an all-party group to be set up to try to flesh out those reasons, the wording and the structure etc would be very useful, but I have a fundamental disagreement with saying that no question could be put to a referendum unless all parties were to agree to it. I just think that's contrary to the process of accountability of the government to the Legislature. Whoever the government is at any given point in time, if they wish to put a question to referendum, they have the right to do that and they're accountable to the public and the Legislature for the basis upon which they make that decision and why they go about doing that.

Secondly, the other problem I have, as I indicated last week, is that one of the reasons we wanted to have some additional time was to go back and discuss the one major area where we had some initial discussion, and that was around the question of citizen-initiated referenda. I indicated last week that I appreciated very much the movement that I saw on the government side in terms of the threshold. I'm in a position where I can tell you that with certain caveats, which I will get into when we get to that point of the discussion, we see a way of structuring a process that would enable citizen-initiated referenda to also be part of this process.

The other reason I have trouble with the motion that is being suggested is that it sounds to me like it would limit that except where the three or however many parties were present in the Legislature would agree, and I'm not sure that's a wise way to go. In total, I find myself in disagreement with my Liberal colleagues on this point. That's where I am.

Mr Ouellette: I understand quite possibly the reasons something like this could be brought forward, in that when you have a concentration of a large population in an area it could dictate what takes place in the other parts of the province. I believe that may be the reason the member could be bringing it forward, but if we look at possibly bringing regional aspects to a referendum to make sure that it's all-encompassing, we may be able to address that issue.

Also, the motion as brought forward only deals with three parties. We have an independent, and who is to say that in the future that may not expand. How are their views to be dealt with on the issue as well?

Mr Hastings: Let's go back to Mr Morin's proposal. You state that the official opposition is in favour of some sort of referenda in principle. If that's so, then and if, as a member of a tripartite committee, the government proposed some form of referenda legislation and we couldn't agree at that point in time as to whether there ought to even be some referenda legislation, whatever the items you'd have in it, which is another whole set of considerations, are you saying then that in effect, if you didn't agree with the proposed bill, just the concept of the bill, that would end it, that if one member of that tripartite committee said no, the government then wouldn't even be able to proceed with the introduction of a bill?

Mr Morin: It's very difficult to speculate and create a scenario unless you know the situation or you understand the problem that is presented to you. I can see an occasion, for instance, where it's a national crisis, where it's an issue that concerns all Ontarians, where the referendum, the wording, should be organized by the three parties. That's what I'm saying. It's a very serious tool to use. It's an important way to consult the public, and that's why you've got to be sure that it's done properly, that you have unanimous consent and that it's not used frivolously.

That's one of our main concerns, because we've seen examples of what happened in the province of Quebec. We've seen how the wording was done. Had it been done by the two parties in existence in Quebec, I'm quite sure that the question would have been totally different than what was asked, because obviously the question was very slanted and a lot of people didn't understand it. It was unfortunate. That's the type of issue, in my opinion, that really can confuse the public. That's why it's so frightening. Improperly used, you could do anything with that.

Let me give you an example. Let us say, for instance, that the government decides that we cannot push a certain bill, as you said, and the bill in the House is not accepted. Let's go to the public. It gives you a chance to determine, by politicizing, by contacting the people you have good relations with -- they say, "Oh, yes, we want that." The minority has not been consulted because the question is worded in such a way that they don't understand it.

I'm not saying this in a derogatory way, because there are people who have total apathy towards whatever happens in government. This is why I feel that it is the responsibility of the three parties to phrase it in such a way that it will be well understood by everyone.

I think this request is very noble in the sense that whenever a referendum is to be called, we all participate, because we all have the same responsibility to make sure that we serve our citizens well, that we inform them well and that we don't take advantage of them. That is one explanation of it, and that's the issue I would like to debate.

Mr Hastings: Could I go back again and revisit my original question? I listened very carefully to what you said, M. Morin, and I infer -- I may infer incorrectly -- the assumption that if there were a tripartite committee established to deal with referenda and the first question on the agenda of that committee was to look at the concept or the possibility of having a referenda bill -- whatever is in it; we haven't even got to that point yet -- would you think that the whole idea of the proposal could be decimated right there if one of the members of that committee said, "No, we do not agree that there should even be a referenda bill, whatever the content of the bill or whatever the title of the bill," and that would, in essence, end the debate on this thing? In effect, we would be giving you a veto.

What I'm trying to find out is, in effect, not the contents, the thresholds, all those items that have to be vigorously debated, but the concept even. Do you believe that the concept of referenda legislation or a bill, however you name it, would be one of the items on that agenda of a first meeting of a tripartite committee, and if one of the members of that committee said, "No way, we don't like this," that would be the end of the whole thing?

Mr Morin: Start again and ask another question. The Constitution is a good example of that, when some provinces, smaller than any others, decided not to favour whatever was proposed.

Let me rephrase that so that you understand really what our feeling is on that issue. A referendum is so serious, so important, that whenever the government or the Legislature reaches a point where it can no longer proceed unless it consults the public -- not to an election; to a referendum -- you sit together and you say, "Look, that is the question we want to ask, because we are stalled, we don't know how to proceed and we want to know what the public is thinking," that would be an approach, but you could create all kinds of scenarios, Mr Hastings.

Mr Hastings: The only scenario I'm creating is whether, at the very start, if we accepted a tripartite committee with that veto proposition in it, would not the rejection of any concept of a referenda bill be the end of the debate on the thing? Whoever that might be, whatever party, that's the end of it, because all you've said at the start is that the Liberal opposition agrees in principle that there ought to be a tripartite committee but we've got no further than that in terms of even the start of the ball game rules, let alone what the rules will be.

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Mr Morin: Once we've established, as you agree, with unanimous consent, then we can proceed and fix it in such a way that the model works. It's as simple as that. There are certain things that we know we don't agree with or we could improve, and we all do that together. That's what I'm saying.

Mr Clement: Can I ask a procedural question, Mr Chair?

The Chair: Mr Clement, I've got a couple more speakers ahead of you. Is it germane to this exact point?

Mr Clement: It is. In terms of how we proceed, if a party at the table right here, right now, operates in good faith and attempts to participate in this process and then at some point down the line there comes an issue which they cannot in all good conscience abide by, can they then opt out of all of the things they opted into before we got to that particular item and that particular issue? Is that available to them? That is to say, because they've signed off on questions A, B and C of the report, thinking that it was going to go in this direction but in fact the committee goes in another direction, then they can say, "We're going to write a minority report at this point, and although we said yes to A, B and C, it was conditional upon D going the way that we thought it would go, but it hasn't, so we can then write a report on our own." Is that fair?

The Chair: I would say, in answer to that, the majority of the committee can write whatever they want; the opposition parties can add as an appendix a minority dissenting opinion on whatever they want.

Mr Clement: The reason I asked the question is because we are going to be talking about, presumably, some of the issues that were raised by some of the deputants. An independent commission would be a check and a balance on the government of the day and on the process that we are trying to construct here. But it may or it may not be that this independent commission may or may not satisfy my Liberal friends. But perhaps they want to participate in getting through some of the preliminary questions before we get to that and then decide whether they're in or out. I'm just holding open that possibility. I don't want you to feel that you're out of the process in terms of a majority report when in fact it might be a reasonable report that you might want to sign your name to. Have I made myself clear?

The Chair: I think I understand what you're getting at, Mr Clement. I would say to the Liberal members, if this motion does not pass, we would certainly welcome their participation as we go through writing the report, if they see fit to continue to participate.

Mrs Sandra Pupatello (Windsor-Sandwich): I think it's clear from the outset that if we outline what the terms of reference are for the future of referenda in Ontario, what we need to ensure is that the subject matter therefore is approved by all parties, whether it's tripartite, because we currently have three, but that can simply be worded more appropriately to say consensus, unanimous consent, on that.

Clearly our feeling is that there are many issues that could happen in Ontario where a referendum is highly appropriate, things like national security, provincial security issues. If we look at a national issue like the War Measures Act, for example, that is something that is clearly non-partisan, in the interests of all Ontarians; items such as the draft. There could be anything provincial or national of interest or security that clearly you can see the need and the purpose for a referendum on for all of the population.

When we get into the specific problems we have, such as regional disparity and geographic bounds that don't provide for what we view as real fairness, that will follow. Even Conservative members need to be sure that all of those things are outlined as you follow this process and that with each point you're going to make today that automatically will follow, but will only follow when the terms or conditions are that ultimately you have unanimous consent for that subject matter.

Mr O'Toole: We're spending a fair amount of time, and I could be completely out of order here, and I hope you will forgive me for that. However, the purpose for this committee to meet, and this has been said by everyone here, is to map out or scope out potential legislation. There would be a whole series of things there, whether it's citizen-initiated or third-party participation of some sort or other, and it'll be a very difficult process. I can see that for sure.

I want to make an example out of this by saying that if we did scope out something and come up with a report, the report would probably not pass unanimously. I can see that happening. The government can bring forward legislation which won't pass unanimously. I don't think many things except "Goodbye to Mr Rae" ever passed unanimously. I don't mean that flippantly. That's where all parties agreed to -- whatever.

That being said, I'll make one example. On the important issues to all Canadians, indeed to every citizen, M. Morin referred to the whole issue of the "distinct society" clause that fell out of the Charlottetown accord which one member of the Manitoba Legislature voted against and killed the whole thing. Your possibility of ever getting unanimous consent on anything is between zero and minus some big number. It's not going to happen, Gilles. Not that I don't want, in every regard, to get along with you and every other member of the Legislature. My point is that I think it's very pre-emptive. I don't disagree with your right to make the motion. I think it's totally out of order. I personally feel that it pre-empts the entire process from happening. A government, at the end of the day, to not hold a referendum is denying the very process itself. If one member of that committee decided to, he could stop the whole process of Ontario government.

On balance, if you had a party with 90 members -- we're going to have 103 members; that's a foregone conclusion, I hate to be so bold -- you may have one party of 13 members and no third party. I can't for one moment think that this particular recommendation is even in order. Not that this isn't a democracy, but how do we get something to the House to be voted on? We'll never have unanimous consent here, not because we aren't amicable friends but because human nature won't allow it; whether it's on minority issues or French, on some issue we'll have a problem working through that section.

I've gone on too long, and I'm really asking the clerk of the committee or the Chair to tell me if this recommendation, as I understand it, is in order. With all respect to M. Morin, I want to go through the process, agree and disagree on certain aspects and steps -- I think there are seven or eight in this report, the guideline here; and at the end of the day, it may not be an unanimous report -- then go forward, and in that process itself it will say that there will be some vetting process for, "Should we vote on going to war?" or whatever the big issue is.

We won't get unanimous consent even on the specific referendum item, ever. Some people may be pacifists and just, by some spiritual nature, completely diametrically opposed, and so it doesn't happen because of one person. That's not democracy. Democracy is a majority situation, and anything else would be presumed dictatorial. I have a serious problem with the whole recommendation. I need some kind of clarification. Have I made myself clear?

The Chair: Yes, I think I understand what you mean, Mr O'Toole. It is in order. A member can put forward a motion. In itself, there's nothing problematic with that. You may very well disagree with what Mr Morin has indicated he intends to do with his motion, and you may have the opportunity to vote against it when and if we get to a vote on it. I hope that will be satisfactory.

Mr O'Toole: But I would like them to participate.

Mrs Pupatello: Just in response to Mr O'Toole's remarks, the irony here is that the current government does have a majority government and you were duly elected by the people of Ontario to be here and represent your population. There are various things. We don't have one man, one vote in Ontario today, nor do we have that in Canada. Even with the change in boundaries that's coming, it is moving closer to one man, one vote, but certainly is not, and it does take into account things like regional and geographic disparities etc.

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Because of that very nature, we come as close as we can in the government of Ontario and in our Legislature to be as reflective as possible of the Ontario population. Because of that, that is the whole process of how governments bring bills forward, giving all parties the opportunity to debate in the House: You read it into the record, read the bill for first reading; it goes to committee, there is discussion; it goes back into the House for second reading, there is debate; it goes to committee, often it's debated and more information is gained at the committee level: it comes back into the House for third reading and now, with the changes made by the NDP last term, there is debate on third reading as well.

That is a process that is ensconced in Ontario history, that regardless of what party is in power, all of us on all sides of the House have that opportunity to debate. Given your scenario of, say, 90 out of 103 coming from one party, regardless, each of us as members is reflective of the population.

To suggest that the subject of bills is not in the control of the government is simply false, because the government in power has the majority power to bring forward bills of any subject matter for due debate in the House by all parties through a process that is ensconced in our Legislature. To throw in, in addition to that, the issue of referenda is simply an opportunity for the majority government to move the decision-making and the difficult part of governance on to a very simply asked question through the process of referenda, and that is something the Liberal Party cannot support.

What the government of the day will do, as has been done in history, not just in this jurisdiction of Canada but internationally as well, is move and manipulate and change the nature of the question so that the result therefore does not speak truly of what the general population feels about an issue. The underlying reason for that is that governing is not simple.

You are now finding that out as the government of the day. The new members opposite can relate -- and I'm a new member as well -- that the answers are simply not as easy as we thought they were before we were elected. We realize now the dynamics of every new bill, all of the implications of every new bill, and all of us are bound by our elected nature to take all of those into account as we deliberate and as we eventually vote. That is because governing is not simple. That too is why the Ontario Liberal Party cannot support the idea of referendum across Ontario if all parties are not participating and agreeing with the subject matter.

In effect, you have already got your mandate by the population of Ontario. Now the Conservative government today, and hopefully different later, you have the difficult job of making the decisions on behalf of your regional disparities that are accounted for, geographical disparities that are accounted for in your very makeup as representatives. That becomes your difficult task, not to be offloaded through a very simple yes/no question through the method of referendum.

The Ontario Liberal Party cannot support that because we understand, as we've seen in many jurisdictions, how that has been abused, and the fallout has not even been understood by the very people who created it in the first place. It's now only after review, years later, that we see some very remarkable outcomes that were never predicted and that now governments of the day are simply having to face because of a very simple question that was not thought out, that was driven more by ideology rather than the acceptance of a very difficult task ahead, and that is for this government to govern. On that basis, our very ideology on this simply doesn't agree.

You need to understand in particular, Mr O'Toole, that the very makeup of your party today is reflective enough of you as government to make the difficult decisions, and we agree many of them certainly are.

Mr O'Toole: I appreciate the response and clarification of your position. I'll put it to you that we go through the process -- and I'll make the same point I've made. We set up a format and some legislation, and the first item that comes forward is, let's say, the government isn't entitled to carry a deficit. That's the first item for a referendum, hypothetically. You would never get agreement on that, and that would mean that one member from a three-person party could stop all of that from happening, from even allowing the people of Ontario to have a vote on it. That isn't democracy at all; that's the complete antithesis of the point you're making. It's allowing a minority to govern.

The ideal state is Switzerland, where they have one person, one vote. I think that's how it works. I read a few things about it; I can't remember, it's so long ago.

Mrs Pupatello: You always forget the details, Mr O'Toole.

Mr O'Toole: No, no, I guess my point is that I hear and understand completely that the government forming a majority makes decisions which may or may not be popular and has to live with that. You're saying we're offloading this responsibility of decision-making and simplifying it by holding a referendum, so we just want to debate this until we fall down in the street. You're clearly on record as saying that one person should govern Ontario. That's what I hear you saying.

Mr Ouellette: I believe the concern in the example that has been brought forward is valid. However, I don't necessarily agree with the method or result that has been presented in order to address the issue.

The Chair: I'm sorry, Mr Ouellette.

Mr Ouellette: I said I agree the concerns in the examples that have been brought forward are valid. However, I don't necessarily agree with the method of solving the problem that has been brought forward. I don't know if there are other solutions that can be presented or if there are other jurisdictions that we can review to find out how that situation was resolved there; or if, through the petition process, the wording of the question is actually placed on the petition that the individuals sign may address the problem. I don't know if there are ways. In other words, there could be examples that we could bring forward that may take care of that situation in the first place.

Mr Dave Boushy (Sarnia): I want to make a very brief statement. It's very obvious you're not going to agree or try to change your minds. This is your caucus decision and you're not going to agree with us, regardless of what we say. I think you're splitting hairs, really. To have a unanimous vote on any issue, one vote could scuttle the whole thing. You don't want that to happen, in a committee or the House. It's silly, really. Anyone, even if your own members and the whole caucus agree to support it, if one of your members gets up -- and it's happened before, one member says no. The whole thing's off? Come on, now. Let's be reasonable.

Mr Clement: I don't want to appear to scuttle debate, but I was actually going to call the question. I think we've discussed this one --

The Chair: Are you prepared to call the question?

Mr Clement: I am prepared. In fact, that's what I probably just did.

Mr Boushy: We're not going to convince you. It's your caucus --

Mrs Pupatello: Can we just finish the speaker's list and then we'll vote for your motion?

The Chair: There are two additional speakers.

Mr Clement: I'm willing to defer.

The Chair: Okay. If there's two more speakers, then I'm quite content to limit it. Mr Hastings, do you want to speak too? Is that what you're indicating?

Mr Hastings: I would simply like to hear from Mr Silipo whether he has any suggestions on this conundrum that we have on our plate, if he sees a way through it.

Mrs Pupatello: I would ask the government members who are sitting on the committee today to think of an example of a referendum item or subject matter that this majority government cannot bring forward in the shape of a bill, introduce into the House and pass. Mr O'Toole's example of the budget, a balanced budget etc with no deficits, in fact is a bill that the government can bring forward. You are a majority government, and you, if that is your wish, can do this without a referendum. Based on the campaigning that this government did to get itself elected, we would expect that would be one of the first that you might bring forward.

The reality is you can do that today as a majority government. Despite what efforts opposition parties may make, we realize that ultimately if you choose this bill to pass in the House, you can do so. I would challenge any member on this committee to bring one issue forward that you, as duly elected representatives from constituencies across Ontario, cannot pass in the House through due process -- that has been the history of Ontario for hundreds of years -- without a referendum. This is not an issue of splitting hairs. The subject matter is far more far-reaching and widespread than that.

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Mr Rick Bartolucci (Sudbury): Just to follow up, with all due respect to Mr Boushy, I think that's the dilemma that we should find ourselves in when we have an all-party committee that needs unanimous consent. We don't want to have to use referendums needlessly or frivolously. I think all three parties agree with that.

I would suggest, if we listen to what Mrs Pupatello was saying, there are so many other avenues that a majority government has to introduce its agenda that referendums should be that very special time or the special item that could and would require all-party agreement. I know it's hard to do it, but that's the essence. Referendums shouldn't be so loosey-goosey that they can be abused, and this is probably the safest safeguard one could put into place.

Mr Silipo: The reality is that there is nothing now to prevent this government or any government from going and holding a referendum on anything they want. I have to say again, with all due respect to my Liberal colleagues, that this is a very convoluted way to go about stating you're opposed to the concept of referenda. I've heard, with all due respect, people say that they are in favour of referenda, but then we want to make sure it never happens unless everybody in the world agrees. We've had an interesting discussion on this point, so the only way I could answer Mr Hasting's question is, let's get on with the vote and see what happens.

I say that, again, with a lot of respect for my Liberal colleagues. I know this is a difficult issue. I can certainly tell you, from the discussions we've had in coming to grips with it, that there are lots of good arguments to say that we should tread very carefully in this area, and as we get into the discussion -- I hope we do at some point -- I will certainly continue to raise some major caveats that I think need to be put into this for it to work properly.

I heard last week from the Conservative caucus members here that there is some willingness for some of those issues to be discussed, and I appreciate that. We will see whether we come to agreement or not, but we're not going to know that until we actually begin to talk about some of the substance.

It's clear that on least one major aspect of this, in terms of mandating referenda, as I've stated before, we are opposed to that concept, and there may be other pieces on which we disagree. Having said that, we come at this not just in principle saying that we support the concept of referenda, both government-initiated -- "Parliament-initiated" would be the way I would put it -- and, on the other hand, citizen-initiated, with all of the due process pieces that I think need to be put in there in terms of the respect for minority rights that we discussed last week and mechanisms to deal with that in terms of taking into account the regional makeup of the province, which is something we will want to see injected into this in terms of the threshold for citizen-initiated referenda.

It's by looking at those kinds of things that you determine whether support in principle for referenda can be translated into anything more than that. I'm willing to do that. I can tell you that I have a mandate from my caucus to be here and to talk about that, and I'm interested in getting on with it.

The Chair: Are the members of the committee ready to vote now on Mr Morin's motion?

Mr O'Toole: We're going to have a referendum now.

The Chair: Everyone is ready to vote. Could you read the motion.

Clerk of the Committee (Ms Lisa Freedman): Mr Morin has moved that an all-party committee be formed to determine whether there should be any given referendum and that the decision of this committee be unanimous with respect to any referendum question.

The Chair: Would the members who are in favour of the motion please raise their hands.

Those who are opposed to the motion, please raise your hands. The motion is defeated.

Mr Clement: I just say to my Liberal friends across the way that I'm certainly very much interested in their input as we go through this. There may be parts of discussion that they feel very comfortable with and probably parts that they don't want to sign on to, but like Mr Silipo, I'm perfectly willing to engage in a very constructive dialogue here to see whether we can come up with something we can all be proud of.

Mrs Pupatello: I guess we kind of expected that outcome. I did want to take the time, before we move forward through all of the other discussions, to bring forward some information that I feel some of the government members may be interested in. We certainly looked at the kind of history this issue has internationally, in particular in the United States, where it's been quite prevalent of late, and I thought I might ensure that the government members understand what potential outcomes of these kinds of issues are on life, on governance, on governments of various levels.

I wanted to choose the most relevant example that's had probably the greatest amount of publicity and that we might even be a little bit familiar with, and that issue that was used in a referendum in the state of California was Proposition 13. Some of you may be more familiar with it than others.

My greatest concern in watching the happenings with Proposition 13 in California was that the general public could never have expected the outcome in their vote on Proposition 13, because it was brought forward with one thing in mind and that was control of tax and tax levels. The similarities, to me, of the government of the day then in 1978 and the current government today in Ontario are great, so I want, and I feel it's my responsibility to do so, to go forward with that kind of information.

Somebody far more clever than I said that life really is no surprise. The only time it's a surprise is when there is history we forgot or history we didn't know. I hope that you'll realize that this discussion is critical, in my view, to this discussion that will eventually allow this kind of bill to go forward and perhaps pass, because as Mr O'Toole pointed out, you have a majority government and there is a process to bring a bill forward, which I have no doubt you will do, for due deliberation and perhaps eventual passage. I need to be on record with how strongly I oppose this move by the Conservative government. In my view, it is a throwback to things that have happened in other jurisdictions in their history that governments of the day, families, societies, organizations have come to regret.

I want to give you a capsule of what Proposition 13 was when it was voted on. I have a quick description just for further edification of the government members:

"California's tax revolt was born of emotion and frustration. It was a movement that was to have a profound impact on changing the structure of local government in California, on cutting back government services, on forcing local government to devise new ways to raise money. It was a movement that would quickly influence other states and other populist efforts to cap tax spending."

As I go through, I hope you'll note that some of the jargon that's become quite popular today in our government and in the House you'll see very much reflected in the pieces of information I'll be advancing today.

"Still, some five years after passing Proposition 13" -- this was written, I believe, copyright 1984, so it wasn't that long after the passing of Proposition 13 -- "and adopting other tax-cutting measures, California voters really did not know the full effects. Despite some discouraging projections from government officials, deputy managing editor Noel Greenwood believed that the Times indeed could set out to try to document the effects of the tax revolt in cities...."

And so they did. They went forward and looked at this kind of revolt in the area of tax and they tried to document it in a very concise manner. If we go further: "Deciding California's tax system at the ballot box" -- and I have no doubt that this really is the intent of passing the bill on referenda and what the nature of the first bill will be. If it doesn't happen very quickly on certain issues, if I were a betting person, I would likely bet that the first referendum issue would be a tax one and it would neatly coincide with an upcoming general election in Ontario.

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"Deciding California's tax system at the ballot box has meant relying on insufficient and sometimes misleading information. It turns out, for example, that repeal of inheritance taxes has mainly aided the wealthy, rather than middle-class survivors, as had been argued during the campaign. In campaigns for hotly contested initiatives, such as Proposition 13, both sides spend large amounts of money for slick drives that barrage voters with slogans and catchy ads;" -- I think all of us here can relate to that -- "as a result, voters must decide sweeping initiatives by balancing emotional appeals, rather than comparing detailed data about the state's finances."

The similarity here is striking, because in effect that's what Ontario legislators must do.

Mr O'Toole: Mr Chair, on a point of order: With all respect, and I'm sincere about this, we have voted on the issue of pros and cons on referenda. I think you could submit your report that you are reading, that someone else wrote, to the clerk of the committee and let it be considered, along with a lot of other issues in this process.

I, for one, did not come here for that. We've dealt with it. We've voted on it. It's finished. We're now moving forward, in my view, consultatively, to develop a framework at the end of the day which may or may not result in legislation. I have no idea; I would hope that it would be at that point in time. I really don't think those comments are particularly germane to the discussion, the purpose for this committee to be sitting this afternoon.

The Chair: Could I just say this in response to your point of order. When I started the meeting we started on question 1: "Should there be legislation authorizing the holding of provincial referenda?" The motion was moved, it was defeated, so at this point we're still discussing that question, should there be legislation authorizing the holding of provincial referenda? If your remarks are specific to that question I will allow them to continue.

Mrs Pupatello: Yes, and I still have the floor and it's very relevant to that.

I guess I have to be specific. Proposition 13 was one of the referendum items that was passed, followed by some 19 others that all took various forms, but the kinds of questions that were involved were those same kinds of things. They were issues that were downloaded to a proposal or a referendum when the decision-making was quite difficult for the legislators themselves. What they chose to do was allow grass-roots movements of the kind that we've seen with various examples in North America, certainly difficult for legislators to deal with.

We spoke earlier, and obviously in your other committee meetings there have been discussions about what kinds of issues might come forward and what types of court challenges resulted. Our legislative counsel spoke to those at the beginning of this meeting, that if you had a referendum that was devised at a local, grass-roots level and received a groundswell and you were able to get the sufficient level of support that you needed, eventually you could have the kinds of issues on a ballot that government members could no longer control, such as the elimination of the Catholic school system. You could receive the full level of support you needed within the kinds of conditions and terms that you set out as referenda, but in fact you would be moving that kind of very divisive decision off the backs of the legislators, duly elected, with geographic disparity in mind, off the backs of legislators who were elected with the population disparity in mind, and moving that kind of answer down to another level, which of course in our view is not relevant.

Let me go through a New York Times article, which is "Lessons From California," written September 25, 1995:

"California, that harbinger of so many fads and fashions, is now a laboratory for the hardship that can result from years of refusing to face up to fiscal realities. Los Angeles county faces enormous cutbacks in health and other services, although the immediate threat that dozens of health clinics would be shut down was eased last week with President Clinton's announcement of an emergency aid package.

"Orange county" -- I think many of us remember how famed Orange county became through its bankruptcy as a county, which really was unprecedented, particularly unusual because it was such a wealthy community and many affluent people live in Orange county -- "the wealthy neighbour to the south, is in actual bankruptcy, and is trying to bail itself out by raiding funds vital to preserving its bus system and infrastructure. The state government, itself awash in debt and deficits, is unable to help southern Californians avoid shredding the social safety net."

Again, we need to liken this discussion here with Ontario.

"The disastrous economic recession of the last several years has been a major factor in California's troubles. But heedless tax-cutting without corresponding service cuts has greatly magnified the budget problems. Since the tax revolt of the 1970s that led to Proposition 13, which arbitrarily froze real estate tax rates, the state has nurtured the lethal idea that public services could be maintained without anyone paying for them. This mentality plunged the state and many of its local governments into debt, some of it covert, as they borrowed from various government reserve and pension funds or issued bonds, notes, warrants and other debt instruments to pay operating bills.

"Like New York and many states, California and its localities have been strangled in recent years by the soaring costs of health and welfare programs and prisons (as a result of tough new crime laws). Education costs have gone up as well because, in the late 1980s, voters approved an amendment to the state's Constitution requiring the state to spend a fixed portion of its budget on education and protect local school districts from the increased costs of enrolment growth and inflation.

"As budget deficits deepened, Governor Pete Wilson and the Legislature borrowed to meet expenses and raided various reserve funds set aside for special purposes. Since Proposition 13, for instance, the state has taken over the collection of property taxes from all local governments and districts. Pressed to meet the new requirements on school spending, state officials simply siphoned money away from funds that had been earmarked for counties. Such actions have compounded the problems facing Orange and Los Angeles counties now.

"Since declaring bankruptcy earlier this year, Orange county has faced the extraordinary problem of paying off $1.7 billion it lost gambling in the high-risk derivatives market. After county voters rejected a tax increase, the Legislature helped it assemble a package of cuts in bus service and spending to maintain harbours, parks, flood control and other infrastructure. Such steps will produce the money, but at a potentially large cost for repairs down the road.

"Los Angeles county asked Sacramento for the right to raise taxes on cigarettes and to be freed from some costly state mandates. But the county is widely seen among Republicans in Sacramento as a den of wasteful spending. Governor Wilson, anxious to cover his conservative flank as he runs for President, rejected the idea of any tax hike, or even authorizing the county to carry out the deed.

"At a time when the call in Washington is for cutting budgets, California offers a cautionary tale. No one is denying the need for making economies in government spending, but Californians are entering a new era of reductions in the entire scope of government that poses a genuine peril to public safety and wellbeing. Harsh limits on government spending will carry consequences that must be documented and debated in the years to come."

There have been a number of papers and stories that have been written as a result of a look at Proposition 13 10 years hence, and it is critical for us as committee members to see those examples of what indeed has happened. I think all of us agree that this is where the government is headed and we have no way of having our own crystal ball for Ontario, but the comparison is absolutely startling and I feel it is imperative that we ensure that our people know.

There was an article that was written in Newsweek, again only in July 1995. The article by Jane Bryant Quinn was called "The High Price of Protest." Orange county is the first municipal debtor to stiff its creditors deliberately. It's a result of Proposition 13. When Proposition 13 was brought forward to all of the voters in California as a referendum item, Californians looked at the ballot item and said, "I'm voting Yes on Proposition 13."

What Proposition 13 said was that it would limit the increase of property taxes on properties across the state of California to a cap of some 2% per year.

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Given that in the state of California municipalities received the lion's share of their taxes from property taxes, this didn't limit the kinds of revenues that were geared for the state coffers necessarily, although it had a major impact on that as well. It capped the amount of revenue that could go into a municipality or more local level of government.

This was a state or comparative provincial referendum issue which was passed but had widespread, huge ramifications for the local governments of the day. Orange county is certainly one premier example of the devastation that can result from it.

"Poor folk kowtow to their creditors, the rich hire lawyers to stare them down. The trouble with bankrupt Orange county, Calif., is that too many residents are rich."

Therein lies the greatest irony, that Orange county, with such a huge level of affluent people living there, went bankrupt after Proposition 13, which limited the level of tax increases or put a cap on property taxes. Exactly as a result of that, Orange county went bankrupt. We need to know why.

"They're telling the saps who lent them money not to expect to be paid in full. Bond market professionals say that this is the first deliberate default." It wasn't that the money wasn't there, but the people of the county said no because, "They no longer feel sure that other major municipalities won't renege." In fact, those in the bond market say, "If Orange county will go this way, so will other municipalities," and it certainly has a significant effect on the business and bond marketing communities.

"The rebellion crystallized last week when Orange county voters rejected a half-cent increase in the sales tax." So with the passing of Proposition 13, which also limited the property sales tax and capped those property taxes for the local government, all they were left to do in terms of revenue finding, because they needed to find ways to bring more revenue into their coffers, were items liked user fees and sales tax. But again the voters rejected it. So even when that county asked for a half-cent increase on the sales tax, the people in their mad fury and emotion related to tax increases, because they had just been seeing repeated efforts to increase taxes, said no, even as minimal as it was. It's really quite strange that the population in the county would have said, "I would prefer to bankrupt my county rather than allow a half-cent increase in sales tax."

I have other documents today that I'd like to show shortly. The public reacts in a very interesting way, and Ontarians are no different from Californians, I guess. In my short life I've noticed that anywhere in the world I've been, human nature really is the same. People react very much in the same way. Whether you live in California or Ontario, if you ask people a specific question and it has anything to do with increasing taxes, the answer will always or almost always be, "No increase to taxes."

When you throw items into the equation that have anything to do with what our data and our statistics are showing, anything to do with education, maintenance of the quality of education, maintenance even as specific as classroom education funding, or health -- those are the two big issues: health as well as education -- people all of a sudden are prepared to fund education and health, but that would never be the case in the issue of referendums. That would be as complicated a question as what the PQ decided to ask the voters of Quebec during their referendum. Those questions could never be put easily to the population of Quebec.

So too would we find the questions that were put to Californians in Proposition 13 in 1978, which was approved. The question was simple: "We want to cap property tax increases at a mere 2% per annum. Yes or No?" Naturally human nature tells us that the answer was going to be yes. There was no question of the outcome. That is the reason for our needing to go into an in-depth look at the results of Proposition 13.

Clearly Orange county has already failed to honour one small issue of bonds, but that was significant because it set a precedent for many other counties across America. Many other states in the United States followed along with California in bringing in their version of Proposition 13. I believe that 21 is the last count of states that have brought forward similar proposals, similar ways to bring in referenda to the people, moved the decision-making from duly elected officials down to a grass-roots population base where the issues are never well explained, where people really aren't familiar with issues, that they take that very difficult method of governing and simply move the decisions down to the greater population. I know that Mr Silipo too has done much travelling in his day and can see that indeed human nature is the same.

Very recently I was able to spend some time in Italy. If we wanted to compare governments, Italy is certainly a case in point, where they have had more governments per year, practically, than we've had in Ontario's history as a province or Canada's as a country. Their issues clearly are taxes, and a problem there. But people will always respond the same whether they're Italian, South African, Californian or Ontarian, and the answer will always be no. As soon as you throw into the equation issues of health and maintaining health levels and health service levels, or education and high-quality education levels for children, the answer will always be fuzzy. People are prepared to ensure that those things become sacrosanct, and there are very few things that are. Certainly public safety is one of those as well, and I will show some documentation later that tells us that the public is also prepared to not answer a simple yes/no question when the issue is one of public safety.

Orange county is a case in point that we should know in detail:

"Your `safe' funds: A number of money market mutual funds, both taxable and tax-exempt, hold endangered Orange county debt -- among them funds managed by Kemper, Benham, Alliance and BankAmerica." Some of the members opposite will likely recognize those large firms."They've all pledged to maintain their net asset value at $1, so investors won't lose any principal. Still, this is the second fiasco to threaten the money fund industry in the past 12 months (the first was derivatives). So it's worth a reminder that you have no guarantee. Cautious investors choose conservative funds that buy only US government securities.

"California tax-exempt bond funds. If you're in (or above) the 28% federal bracket and live in California, you'll probably want to stick with the California bonds." The relevance here is that any respect the bond markets had for Orange county was gone as a direct result of Proposition 13. This kind of legacy -- if you think "Orange county" you think "bankruptcy" -- could be devastating to the business communities in that kind of county. Conservative members here always tell us how business-minded they are. You can imagine how devastating it would be to have that huge cross to bear of being bankrupt as well. It's something that Orange county, years later, simply has never recovered from. Our friend Mr Silipo is fully aware of that.

"These new risks mean that many innocent California cities have to pay more interest" -- more interest for other cities that were not bankrupt, but Orange county was; just because the risk was higher, their interest rates went up by 0.25%, and in my view that is fascinating; despite what Orange county people decided to do, the ramifications were widespread throughout the state of California -- "to sell their debt, says Mark Donohue of Gabriele, Hueglin and Cashman in New York. Because Orange county wouldn't pay a sales tax, everyone else is paying an Orange county tax."

Imagine that half-cent increase in sales tax in Orange county. The result: Every other county and city in the state of California pays 0.25% more on the interest for their borrowing etc. Every other resident in the state of California is now paying for the mere half-cent increase in sales tax that the Orange county people refused to pay because the question was so simply put: "Would you pay an increased tax?" The simple answer was no. What has now happened? All California residents have paid that significant price. The people who write the article say it very well:

"The state's weaker credits, like Los Angeles county, need to back their debt with expensive insurance or bank letters of credit before they can market it at all. Orange county secured a $155-million issue with a letter of credit and still paid an extra 1.5 percentage points." That fact there, my friends, is fascinating to me.

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I don't know which of you are perhaps in the construction or development industry. Do we see what's going on in Ontario today? In order for a developer to get involved with a development project -- banks are an essential part of their business, and they go to the bank -- banks now are requiring these bid bonds to even submit their bid for one of these projects.

What's happened today that is fascinating to me, and I know to the Chair as well, is the difficulty for companies today to secure their bid bond. It's never been as difficult as it is today, and that's not because that individual developer did anything wrong or ever defaulted on payments or didn't sufficiently complete a project or take care of those deficit lists they always make at the end of every project. No. From any developers, regardless of how good they've been and what wonderful credit ratings they've had, those bid bond agencies are now requiring massive amounts of assets and equity to allow them to have the bid bond regardless of the value of the contract they've just won.

That speaks to certain instances in the community at large, in the industry at large, that has had some fault as a result of high recession in the early 1990s. They have now said that risk is too high, regardless of the contractor who has just won that bid. They too have more difficulty today in getting a bid bond than they've ever had in the history.

I know, Mr Silipo, you have noticed this because some of your friends in the Toronto area have spoken to this on several occasions. It's quite difficult now for the financing regardless of how wonderful their credit has been.

It's fairly easy to draw the parallel between what developers are currently facing in the area of bid bonds and what California counties and municipalities face state-wide: The balance of the state of California had to pay for what Orange county chose to do.

"The county's problem is that its refuseniks" -- which is what this writer called them, no tax increase on any basis -- "don't see the real costs. To save $50" -- in effect that would have been the cost, a mere $50 -- "they've sentenced themselves to tens of millions in legal bills" -- legal bills, we haven't even entered into that discussion; we'll have to save that one for later -- "money that could have been spent on maintaining the public quality of life. Real estate values will decline, as money doubts discourage families and businesses from moving in. County user fees will rise. The financial fallout will do more than moralizing to stop copycat defaults. Only in movies can you be a hero for -- "

Mr O'Toole: On a point of order, Mr Chair: We've been sitting here for a period of time, and I'm not certain that the member who's speaking is a member of the committee or has been substituted in. She has every right to submit her points of view on the debate.

From the researcher's report we have upon the table here the very first order, the first question that's posed, I would move --

Mrs Pupatello: You can't move on a point of order.

Mr O'Toole: should the Legislature be authorized to the holding of a provincial referendum? I would like to move that question now.

The Chair: I've listened to your pont of order, Mr O'Toole, and I would in response again caution Mrs Pupatello to continue to make reference to the question I asked: Should there be legislation authorizing the holding of provincial referenda? Mr O'Toole, it is out of order for a member to make a motion on a point of order. So Mrs Pupatello has the floor.

Mrs Pupatello: I recognize that this will never be a simple debate because the whole issue and impact of holding referenda in Ontario will never be simple. Whole my remarks are germane to the question, they seem fairly widespread. Obviously Proposition 13 --

Mr O'Toole: I think you've made your point, though. On my point of order --

Mrs Pupatello: I'm sorry, but I have the floor, Mr O'Toole.

Mr O'Toole: I believe your point is made.

Mrs Pupatello: The reality is that when you bring forward legislation that involves referenda for the province of Ontario, all of us as committee members have to understand what the widest impact of that kind of legislation could be.

It is my view, especially after some of the remarks even today from the committee members, that there is not yet an understanding of how far-reaching and widely impacting bringing referenda into Ontario can be, and that really is my role here as a legislator, while not being Conservative, being Liberal, but having taken the time to see the kind of impact it can have.

Our members of this committee cannot make these decisions without having at least access to this information, so I really have to ask the committee members to have patience. This is so far-reaching, this is so wide in terms of its impact, it is absolutely critical that committee members at least know the den you're deciding to walk into before you walk there. That is our job here; that's our job as opposition members. So I will move --

Mr O'Toole: That's your opinion. That's all it is.

Mrs Pupatello: Indeed, "Tax Defeat Makes Orange County's Fate More Perilous." As mentioned previously, through Proposition 13 in California, the people who were resident there when they voted on it never realized the impact. It is our job then to ensure that Ontarians don't fall into the same trap; that when we're making those very simple ticks on a box that say yes or no, our Ontarians don't make that same mistake.

Mr Chair, I can't tell you enough how important it is for us to see what has happened in other jurisdictions, because this will come down the road here. I have documentation to enter with you that proves not only is the jargon the same, the very issues are the same. When you take from one, you're always taking from the same one, regardless of what jurisdiction you're in. We need to see the ramifications before we jump headlong into this. This is absolutely critical, and in my view this issue of referenda in Ontario will be the single largest impact on the Ontario population.

"Now that the voters of Orange county" -- and this was also written in June 1995; quite interesting, because the articles have since come out only years after that fateful day in June 1978 when Proposition 13 was passed. It's taken more than a decade for people to see the ramifications. But all of them, regardless of political colour, whether they were Democrats or Republicans, it didn't matter, whether they were local, state or federal, all of them, could see that it was critical that Proposition 13 was absolutely pivotal in a trigger reaction for a number of other things that happened to that state. So I have to say:

"Now that the voters of Orange county, California, have overwhelmingly said no to an emergency tax increase, it has become even trickier to resolve the severely pressed county's financial problems. And chances that the state of California might immediately step in to help appeared to be diminishing.

"In a watershed vote on Tuesday, the electorate of the conservative southern California area rejected, by a margin of more than three to two, a proposed half-cent sales tax increase intended to lift the county out of bankruptcy.

"The increase would have raised the combined state and county sales tax rate to 8.25%, from the current 7.75%. Without it, many in the municipal bond market contend, the financial situation in the county has gone from bad to worse, threatening to hurt the broader municipal bond market."

You can imagine the kind of pressures that other municipalities were giving to Orange county not to allow this to go through, not to allow themselves to be bankrupt.

"The tax was to have provided the county, which is short of cash, with $130 million in new revenue each year" -- $130 million, in perspective, is only half the budget of Toronto's Sick Kids' Hospital. It's actually quite fascinating what $130 million would have done, not just for Orange county but all municipalities in California.

"More important, perhaps, the vote was being viewed yesterday as a sign of a stubborn unwillingness on the part of this affluent area south of Los Angeles to honour its financial obligations after losing $1.7 billion last year in risky bond market investments. The county filed for bankruptcy protection in December.

"Paul Nussbaum, a Wells Fargo executive and assistant to the interim Orange county executive, William J. Popejoy, said that with the defeat of the sales tax increase, debt holders might now receive less than full repayment.

"`Obviously getting back 100 cents on the dollar is off the table.... This is turning into a typical bankruptcy, where everyone develops a bunker mentality. After this vote, no one is going to remember Orange county just for Disneyland.'"

That in fact is the case, that you could take Orange county, with the kind of background and reputation that it had, and reduce it very simply to one of bankruptcy. Again, the pivotal cause of that was Proposition 13, which was allowed to be placed as it was before the voters of California because they were allowing referenda in that state, just as the Ontario government is choosing to do today.

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If we give examples of the kind of questions that can or cannot be put forward in referendums in Ontario, let me take you back to this afternoon in the House today, where again the Premier was asked about the potential of using referendums for Metro and the megacity in Toronto. Perhaps now because the Conservatives are aware that some polling has been done and more than 50% of those being polled have said they are against the creation of a megacity, given that's the case, when you ask a simple question, a question that could easily be put, "Do you want a megacity? Yes or No?" and you have a sense that the answer to that might be no, the government then has stood up and said, "No, we will not allow a referendum on that issue."

You can't have your cake and eat it too in this kind of debate. You either go holus-bolus into referendum, no sacred cows, or you don't go there at all. When we talked earlier of how we could go forward with referendums on issues of national interest, national defence, there are significant issues that go far beyond partisan politics. That might have to do with our veterans, because of our past wars that Canada's been a member of. It could be something against terrorist activity, which obviously is non-partisan. It could be something to do with that provincially, provincial versus federal. It could be federal versus provincial. It could be Ontario versus other states. It could be Ontario versus other countries.

There are a number of issues that would be non-partisan in nature, and no party would do to Ontario what is not in its best interests. We say if that is the reason, if you cannot allow all parties to have unanimous consent on the issue of what the question would be, on what the very issue would be, then that tells us that it's more in line to be used for a political purpose.

If it's the government's intent, as this afternoon displayed, to use referenda only when it suited its political agenda best, then no political party could agree to using referenda in that manner. It that was not the case, then Minister Leach and the Premier of Ontario today would not have said no to a referendum on the issue of the megacity.

You see, we are now in a conundrum. The government has just caught itself in its very first example of when a referendum is of no use to government and its political agenda, and that is the case; that is exactly what would happen.

I mentioned at the outset that there were very significant reasons why the state of California decided to go to legislating referenda in their state. It was so similar to where Ontario is today. It's interesting, because many fads actually begin in the United States and within a period of five to 10 years they eventually move over to Ontario. I believe the tax revolt is certainly one of those.

It's in the contours of the tax revolt from 1978 to 1983 that there was a grass-roots movement, and let us liken this to the national movement in Canada with the upsurge of the Reform Party, which began in western Canada -- very close to California, I might add. It was a very reformist attitude, reformist movement, right-wing, that started this grass-roots, anti-tax movement.

Anti-tax in and of itself is certainly not a Conservative notion. I would hazard to say it's certainly everybody's notion that no one wants to pay more, but the beauty and the simplicity, in their view, that the Reformers had of this kind of tax revolt was that it was always made in its simplest of forms, to which we always said: "Ah, if life were only that simple. If the question that we could ask was only as simple as that."

That will always be the case, with whatever referendum item or subject or question put. That will always be the case here too, regardless of the issue, regardless of the topic and the way you choose to put the question. Ah, if only things were that simple, and our ability as legislators to get out into our general constituency and ensure that everyone voting on proposal A, B, C or whatever it might is fully informed, has every nuance of the issue, every possible outcome of that debate or every possible impact, negative and positive, of that issue. All we can say is that we know that is not the case. If we were to --

The Chair: Mrs Pupatello, could I interrupt you for one second? I must say it's a pleasure to have you join us this afternoon to give us your opinions on this issue, and I've enjoyed your presentation so far, but we have a couple of other members who have expressed an interest in discussing this and I was just wondering if you could indicate how long you intend to continue speaking on this issue.

Mrs Pupatello: If you could tell me how long before I have the floor back --

The Chair: You still have the floor. I'm just interrupting you to ask this point of clarification.

Mrs Pupatello: How long are we going today?

The Chair: We sit till 6 o'clock and then we shut this committee down for the day.

Mrs Pupatello: I'm prepared to simply stand down for now my position, because I have clearly not finished my discussion, although maybe what I'll do is I'll just continue because then I'll make sure that I get closer to my end.

As I was saying, regardless of what these issues might be or how you choose the subject matter or the nature of the question, it will never be simple enough to allow the people -- or it will always be too simple, so that the general public won't be able to make their decisions based on real data, real information. I guess I want to say too, why are we giving our jobs away? As people who are coming here to the Legislature, that is our job.

I am the representative of Windsor-Sandwich. Every time a bill comes forward it is my job to go to my people in my riding and say: "How do we feel about this bill? What are its implications? What are the ramifications? What could possibly happen, good and bad?" It is my job to take that information -- if it's good, bad, indifferent, it doesn't matter -- it is my job as a legislator to go into the House, bring that information into debate, ensure that I've decided what is in the best interests of my constituents, and then go forward and vote, with a full heart, knowing that I am being truly representative of the people of Windsor-Sandwich. My job here, whether I sit in opposition or in government as a member of the government, is no different. It's all our jobs to do that.

I harken you back to the question I asked at the outset: What possible question could you put to the voters in a referendum that you cannot bring forward in a bill? You are the majority government. You are representative of your ridings by virtue of a democratic election and therefore you have no grounds to do anything other than be the party in power to bring forward bills of the government's wishes. Clearly that's your role.

If we look at the example of when you have the most negative outcome possible, California is always at the top of the list. "Resistance to high taxes, of course, is an ancient and widespread phenomenon, so the term `tax revolt' is used" in this description "to refer specifically to the popular movement that erupted in many American states in the late 1970s. Impatient with the ordinary processes of legislation, angry citizens took matters into their own hands to propose far-reaching and enduring restrictions on the authority of elected officials to tax and spend."

In the case of California, they chose to do that by virtue of a referendum, specifically Proposition 13, whereas in Ontario we already have elected officials who are completely in a position to do what they did there, only in this case the legislators themselves are responsible for the decision-making. Of course it makes us wonder, what responsibility are we as legislators prepared to offload to the general public who can never -- not by virtue of not being capable but simply by virtue of living a life where this is our job -- to be sure what the outcome could be, based on how we are voting today.

The legislators in Ontario really are responsible for the way they vote and the way it impacts on people. I believe that legislators here have to ensure that they keep their hands on the responsibility. When I come from Windsor, there are people who are Italian, Vietnamese, they speak French, they speak English, they speak Italian. It doesn't matter how old they are. We've got old age homes. We have seniors, we have babies, we have prenatal clinics, or we used to, in the city of Windsor, and it doesn't matter. When I come into the House in my seat as the elected official, I speak on behalf of all of them, and when I vote, I vote on behalf of all of them. That is the danger of Proposition 13.

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I wanted to specifically refer to education and health and how they have been affected. The one I would start with as well is public safety, because this Conservative government here has made a special case for public safety: that you're tough on crime, that you're going to ensure public safety and always ensure a high level of public safety for communities across municipalities in Ontario.

Let me tell you what happened after Proposition 13 so that we could look into a crystal ball of somebody else's and say, "What could possibly happen here?" This discussion on public safety in my view is critical, so I would ask you to draw some comparisons as you hear this information.

Public safety: "If you are contemplating a life of crime, Proposition 13 may have made it safer for you to embezzle from your boss but riskier to murder your spouse." Now, this is quite interesting: "If you get caught doing either, your chances of going to prison are higher, and don't look to your friendly probation department for help in getting out sooner. And if your neighbour's house catches on fire while you are behind bars, chances may be better that the fire will burn your house as well, depending on where you live. Cutbacks since 1978 have forced most public safety agencies to refocus priorities and to lower goals in some areas so that they can be raised in others."

This is a very specific example of the outcome of a referendum issue used in California. It speaks to what our agenda in Ontario is, and I am speaking about the Conservative agenda. You have a majority government and you have been elected on certain issues. Mr Chair, I know you'll agree that public safety was one of those, so you must be interested to see what the fallout would be, especially in the area of public safety. This is critical in my view.

Here are some of the most important changes after Proposition 13: "Many police departments no longer investigate a wide range of crimes and have narrowed their efforts to where they think they can do the most good. That generally means that police now concentrate more on violent crime and offer fewer services in such areas as burglaries, civil disputes and traffic accidents."

Could I hearken us back to the first session of the House, when the Attorney General was on his feet trying to answer questions from Liberal members about why a very simple break-and-enter was simply not a priority with the government. We were shocked at that time because we knew there were cuts that were already happening to government. We already knew the cuts were there, and one of the first fallouts was that if somebody breaks into your house, violates your property, big deal; they are throwing that out of court. Why? Because the Attorney General simply doesn't have the money to fund the court system to allow for those kinds of cases to go through the courts any longer. So as I read this, the similarities to me were striking.

I would say I'm probably going to make a copy as well, because specifically on the issue of crime, when the Conservative government was specifically elected on this basis, I can imagine that it has already started in Ontario without the use of referenda in Ontario. We all know that the subject matter will be one of taxation and the levels of taxation. Clearly we've got to be sure that this is what could happen in an Ontario that would be very much like a California. So let me say that these kinds of examples, which are fairly briefly described, are so similar to what is happening to Ontario today that it is striking, and it's the responsibility of all of us to know what they are.

"There is a greater danger of fires spreading in some areas, including Los Angeles, because some fire departments have reduced the size of crews aboard pumper trucks from four firefighters to three."

Members of the committee, we know that at the end of the day today in the Ontario Legislature, we are bringing forward -- is it Bill 94 that deals with firefighters?

Mr Bud Wildman (Algoma): It's 84.

Mrs Pupatello: Now, we just told you about an example years after Proposition 13, a referendum issue, where the full effect of that Proposition 13 was that they reduced the number of firefighters on the pumper trucks from four to three. What did that mean in effect? The lessening of the level of safety for people in fires.

With the bill that's being introduced today, the full effect of that bill on firefighters and how they fight fires, I'd ask you to guess what that's going to mean. I'll tell you. It means the standards are not going to be consistent any more. That means with the Windsor firefighters, they will go aboard that pumper truck with fewer firefighters on it than they did yesterday, as a direct result of the bill that this current Conservative government is bringing in today. Again, what's striking about it is that this is the government that was elected because you were going to increase or at least maintain the level of public safety. Why did that happen in California? It was a direct result of Proposition 13, which was only allowed because referendums were now the order of the day in the state of California.

The other examples are just as fascinating when we can look into a crystal ball that was the reality in California and say, "No, Ontario cannot go there, even though we've already turned the car on that highway."

"Efforts to rehabilitate felons after they have been returned to the streets have been severely limited through major cuts in county probation departments, the most heavily hit area in the criminal justice system, but while that sounds like a major change, there is serious debate over whether those costly efforts ever did much good anyway."

It certainly does speak to having to change the nature of doing business and that there are always better and more effective ways of doing business, but not, in fact, a discussion on not doing that business at all, and that is the issue.

"One area cut the most is research. Thus, at a time when agencies need to refine and streamline programs, they have lost the means of determining which are the most effective."

So it's six of one and half a dozen of the other. Do you decide what to cut? Well, you don't really have the money to decide what to cut, so you just cut. It's strikingly similar to many examples going on now with agencies, boards and commissions across Ontario, that we are failing to give them the opportunity to determine what are their priorities because we've cut their funding so significantly.

"Most prosecutors are forced to carry a heavier workload than most public defenders now, meaning that the publicly paid lawyers who are trying to keep defendants out of prison now have more time to devote their efforts than do the lawyers who are trying to put them away."

Well, that's fascinating. So the very thing they did was allow more people on the street to put those prisoners away, and so, "The court then must appoint private counsel at taxpayer expense, and that is far more expensive than counsel furnished by the public defender's office.

"This has come about in varying degrees around the state, despite the fact that public safety agencies have fared better than most other sectors of government." They did well partly because of strong anti-crime sentiment and partly because legislators, stemming from, again, Proposition 13, required a maintenance of effort in public safety.

Let me check my notes.

Mr Clement: Mr Chair, can I have the floor?

The Chair: Are you finished?

Ms Pupatello: "Figures compiled by the state controller showed that cities continued to increase police department budgets after Proposition 13, although much of that increase was eaten up by the rising costs of pensions," quite striking when you make the comparison to Ontario, that as a direct result of the referendum which resulted in the passing of Proposition 13, when they looked to hurriedly, quickly, massively, immediately cutting their level of civil service, they ended up having huge costs of buyouts, pensions etc. I've got to say that our government probably in that manner is following along the same footsteps of California.

All we can say then is that in the area of public safety, the very use of Proposition 13 in California, which is a direct result of the state of California introducing legislation for referenda in that state, was folly. It went against the very essence of what the Republicans stood for, and that was maintaining, nay even improving, the level of public safety among the population of California.

One of the things that was mentioned in the House this afternoon had everything to do with health and the promises the Premier made in health, which was never cutting the expenses, or covering the expenses of health in Ontario. The opposition parties have argued, and we feel rightly so, that there have been massive cuts to the health care system.

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How does the issue of referenda and the state have anything at all to do with health? I need to make this very clear because I know now that there are many Conservative members across Ontario, many who are sitting on committee today, who wouldn't believe that the bill on referenda and allowing Ontario to have this legislation in place -- what does that have to do with health? Why should members opposite be concerned of the impact of allowing referenda in Ontario and its impact on health? Why would we be concerned?

Let us look at the example that California placed before us where years later we can now see how significant, how dire, it made the situation for health programs in California. Those of us who come from communities that now are having some pretty dire consequences from the massive cuts to health care, in particular our health cuts to hospitals, in particular the fact the cuts have been exacerbating the already low funding level for communities like Windsor-Sandwich -- I know that Sarnia is in the very same predicament. I know that an area today like Pembroke is again in that position. Most outlying communities in Ontario that are not part of a teaching centre for health are in that same boat.

We keep saying, "Boy, wait until that commission gets through with Ottawa and then we're going to have some people jumping." But I know that my colleague the member for Sarnia and myself have been dealing with the issueyou of a lack of obstetrical care in our area.

Mr Clement: On a point of order, Mr Chairman: Could the member please keep to the topic at hand?

The Chair: I would caution Mrs Pupatello to continue to confine her remarks to the question I've asked.

Mrs Pupatello: The issue right at the outset is how relevant, how important, how critical is and what the impact would be of legislation dealing with referenda in the province of Ontario, on what? On health care. Those members here today who come from areas that are already seeing some pretty disparate levels of health service need to know why the issue of a referendum has anything to do at all with health. So let's look in the crystal ball that others place before us so that we can see what happened after Proposition 13, which again only came into being after the state of California allowed for referenda there.

Health programs: "It is the three million to five million poor Californians who depend on government-subsidized medical care who have suffered the most from health care reductions triggered by Proposition 13 and subsequent cuts in local, state...spending. While Proposition 13 is not solely to blame, the poor now have fewer medical benefits, pay more out-of-pocket expenses, have greater difficulty finding care and face a longer wait when they do find it."

I find this particularly striking because Ontario is already well on the road there. It's critical for us to note that while Proposition 13 in the States was passed, this was actually documented five years after, so that we could see that in a short five years, they did have a significant demise in the health care system there.

"Says Robert White, director of health services for Los Angeles county," which of course is massive; millions of people in Los Angeles county, "`There are lots of people not being cared for, but we don't know how many.' The cutbacks also mean that the quality of health care for the poor increasingly will lag behind that enjoyed by the better insured, more affluent majority.

"In some counties, public hospitals -- traditionally the health facility of last resort for the poor -- have been closed, sold or leased to private organizations to conserve scarce property tax revenues."

This hearkens back to what the very question of Proposition 13 was. They only allowed Proposition 13 because the state of California allowed referenda. That's a very critical bridge that we have to understand.

When they asked the question in Proposition 13, they would allow a ceiling, a cap, only a certain level of increase in property taxes, and during the tax revolt, for those in California, they said, "We will only allow a maximum of 2% increase." Now California faces a number of the same issues that really are peripheral but very germane to what goes on in the province or in the state. California, for example, has one of the largest increases in influx of immigrant population. They have, therefore, a significant level of a low literacy rate, a significant issue with people who are simply not affluent. When you have those kinds of increases, it has a massive impact both on the health care system and on the education system. So our similarities really are quite striking.

Not only that, did you know that the city of Windsor, my area, Essex county, is actually on the same parallel as the state of the California? We're all on the 49th parallel. That is the only one I will consent to not being germane to this topic, but a fascinating fact none the less, that we're all on the 49th parallel with the state of California.

Proposition 13 made the big difference in the area of health not in that it was affecting those who were affluent anyway, but in the very nature of what the state of California was: that it had a massive influx of immigrants. You know that "Run for the border" that Taco Bell always uses? Well, obviously "Run for the border" came from the border of the state of California. They had a massive influx of illegal influx, or aliens, as they call them there, that made huge bites into the health system as it existed currently. Even with the 2% allowance tax increase on property taxes it meant that people were loath to move out of their homes. It was much like the rent control debate today, where we keep saying, "Seniors, prisoners in their own apartments," because they weren't affected by the increase in property tax unless they chose to move. It is a critical issue that people were not moving like they were going to move.

Even though they allowed a 2% increase, that 2% could never account for the massive increase in services that was going to be needed and was needed in California, even a mere five years after the passing of Proposition 13, because you had illegal aliens, many of whom were illiterate, many of whom had added health care costs for of a number of reasons, and they certainly were not affluent either.

Those people, that kind of population, that massive influx into California, mean a burgeoning need in health, because those who are illiterate also tend to have greater health problems; those who are poor tend to have greater health problems. That same population will tend to strap the very few services that were available in California at the time, and the 2% they were held to, those legislators with their heads under water because of Proposition 13, couldn't move past the 2% increase even though their population demanded it, so the natural result was that the health care service would suffer.

I have to bring you back to why this is relevant to Ontario. Look at even the city of Toronto. In terms of the kind of influx of immigrants we have, 60% of all Canadian immigrants come to the city of Toronto, after that they go to Vancouver and then to Montreal. Those are the three.

When we look at education, we have to look specifically to Toronto. Why does Metro Toronto, whether it's the Catholic or public system, have such great difficulty in terms of increased education costs? It's because there are outside factors that continually influence the education system. You have the highest number of immigrants who come here. The larger majority of them, against the general population, have literacy difficulties. Many, the majority of those, also have difficulties simply because they're poor, for the most part. They come here with very little; they are not part of an affluent society. What that means to the education system here is that it costs educators more for those children than it does for other children. We have to recognize those things.

It takes me back to the tour that Father Day gave me at a separate school on Queen Street East. There's a school out there, and I went to see it. Most striking about Father Day's school was that it had a breakfast program affiliated with the church there, even though that wasn't with taxpayer dollars, but they also had a nursery for the grade 7 and 8 students at that school -- and I'll bring this around right now, Mr Clement. Those extra programs are required because the attendance at that school is not the same as attendance at the school in Merlin, in Essex-Kent. Surely we can recognize that the needs of the children of Merlin are simply not the same as those of children in Metro Toronto for the variety of factors I mentioned earlier.

In the strapping down of an allowance of government and legislators to move and help fix those things, when you have the allowance in Ontario for referenda, so that our first question will have something to do with the tax levels, instead of just guessing what will happen, we need to look at what has happened in other areas. Health programs: In my view, for the Conservative members who have dared to speak out even against their own government lately, we know that this is of paramount concern to them.

1740

"In some counties" in California, "public hospitals -- traditionally the health facility of last resort for the poor -- have been closed, sold or leased to private organizations to conserve scarce property tax revenue"-fascinating in the climate we currently have in Ontario concerning privatization, even in the health care sector, which is quite shocking. "Forty-nine of the state's 58 counties operated 65 hospitals in 1964. As of last January, 26 counties were operating 33 hospitals," a massive drop in the number of hospitals that were being organized and run by counties in California in just a few short years. "The remaining 32 counties lack county hospitals." I would hearken us back to this afternoon's discussion regarding Pembroke, which has since lost theirs. "Nine such hospitals have closed since the passage of Proposition 13, or their operation turned over to private management firms in attempts to cut costs. `The state lost four county hospitals in the past year, in (some) instances the only hospital in that county,' said Dr Peter Abbott of the state Department of Health Services. `When you close a hospital, people don't know where to go. Some become sicker. Some die.'"

I thought it was very telling and critical that members of this committee knew this was at least part of the legacy of Proposition 13.

"Last summer" -- this was five years after Proposition 13 was passed as a result of referenda being allowed in the state of California -- "the Legislature sought to trim about $600 million from Medi-Cal," which is the California state typical comparative of OHIP -- "the state and federally funded health care program for the poor. Lawsuits and delays in putting the cuts into effect will result in fewer savings than expected. But the cuts have eliminated a wide variety of non-emergency medical procedures, surgeries, drugs and other items, required prior authorization for others, and removed about 50,000 people from the program."

Out of those 50,000 people who were removed from the program, 18,000 were in Los Angeles county alone. That is a very striking similarity to the position the city of Toronto is in, because Los Angeles, obviously a huge city, would have the same effects by those kinds of cuts as Metro Toronto, where the greatest concentration of those affected will be.

"Crucial in this was the redefinition of a `necessary' non-emergency service. Medi-Cal once paid for any service `reasonable and necessary for the prevention, diagnosis or treatment of disease, illness or injury.' But the new definition limits services to those `necessary to protect life or prevent significant disability.' As a consequence, a patient with a hernia, for example, may or may not" have to pay to have it repaired. "Short of that, however, the program in effect says to the patient, `It won't kill you, so you will have to live with it because we don't have the money to pay for it.'" This in my view is striking: "Paul Ward, president of the California Hospital Assn, says the result of these new guidelines is that `nobody (doctors and hospitals) is doing anything they don't have to do in order to save life and limb.'"

It is so critical for me at this point to give you the clearest parallel of all: a letter dated December 2, 1996, from Dr Glanz, chief, Cardiac Catheterization Laboratory, in my own community, where he talks about a letter he received from the Windsor Regional Hospital. It was also copied to Jane Pickard, who is involved with the programs at that hospital. This is in Windsor in 1996, so if you recall the discussion we just had regarding the effects of Proposition 13 and what kinds of decisions people were forced to make -- what kind of health services to continue to provide, where do you draw the line, what is necessary, what's not necessary -- we had this letter faxed to us only a couple of days ago:

"Further to our meeting of 18 November 1996, I wish to confirm plans to reduce the number of cardiac catheterizations at Windsor Regional Hospital." For those who aren't that familiar, and I'm certainly not, the cardiac catheterization procedure prepares the patient for bypass surgery. This is a critical element in any hospital across Ontario, because without it, the patient doesn't get the bypass.

Ontario has an aging population, an increasing population, and regardless of what this government has done to supposedly help those lineups for cardiac care -- if you recall the front page of the Toronto Star the other day, the lineups haven't gotten any better; in fact, the lineups have gotten worse, even though the health minister doesn't know why, and he suggests he's tried to fix that, while it's gotten worse -- we see now that they are reducing the amount of money to allow the cardiac catheterization process to continue, that where it's already been shut down to three days, it will now be shut down only one day a week.

Why is it relevant? Because that means it'll take longer for people to get that process completed so they can move into this lineup, which is the bypass, and bypasses are not done in the Windsor area. We are simply delaying the line and making the line longer for people to eventually get bypass surgery.

I should give you a copy, Mr Boushy, the member for Sarnia, because Sarnia and Windsor have many similarities, particularly with health care services available to us. This is coming down the road for Sarnia as well, and I hate to be the harbinger. In the olden days they used to shoot the messenger, so thank goodness that we don't have kings and fiefdoms that still have that practice in place. That is what's going on in Windsor.

What's telling about this is who will decide that the cardiac catheterization for a particular patient in Windsor is no longer as relevant. It is much the same in Los Angeles county or even with the 50,000, state-wide, in California who were then removed from receiving the kind of care that was needed, and again the critical point there was the redefinition of "necessary." If we hearken to the debates we've had in the House of late, many, today and yesterday, were around the definition of "disabled." You recall that our member from Hamilton, Dominic Agostino, asked your Minister of Community and Social Services, "Are you changing the definition of `disabled?'"

Why is that conversation relevant now? Because this is what the current Conservative government is going through, thrashing around where to find the money even before the element of a Proposition 13 hits Ontario, and Proposition 13 could only happen because the state of California had a referendum law because they were bringing forward legislation and it passed.

This conservative, right-wing agenda of California allowed themselves to pass referendum legislation to have the opportunity, for those in power that day, to put the very simple question before the people of California, "Do you want to stop the taxes rising in your state?" They didn't say, "Do you want to ensure that no one gets knocked out of the health services in the state of California?" so that people would have said yes. How do we know they would have said yes in that case, that they wouldn't allow those people to get kicked off? Because they did polling at that time. Even the polls of the day showed that had the question surrounded the level of health service available to people, they would not have voted in favour of Proposition 13.

Regardless of the decade we're in or the state or province we live in, regardless of where, there are some things that people will always say yes to. One of those things is health care. But the people in California never knew the full implication of Proposition 13. In the typical household you've got a couple of people working. One might work on a shop floor at Ford, the other might be an attorney in the state of California. Did any of them realize that when they said, "Yes, I want a cap on my property tax of only 2%," that meant 50,000 people would be thrown off the necessary medical emergency services required of them? Had they done it, had they known that -- they did polling at the time. When they went back later and started asking, "Hey, are you glad you voted that way?" the majority of the people said no. It was really quite fascinating. I have those data to enter as well: After the fact, when people saw the horrendous outcome of Proposition 13, they said, "If only I could choose again." The majority of the people would have said no. Those are very striking data that all of us must keep in mind.

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In California at that time, "About 260,000 people known as medically indigent adults are no longer eligible for Medi-Cal" -- these indigent adults are the very people who require services the most; that probably goes without saying -- "and counties have been forced to assume responsibility for their care." In fact, counties have been forced to assume responsibility for their care. The counties were the same counties that weren't allowed the increase because of Proposition 13. They were now being forced to assume the responsibility, the financial cost of that additional burden. The very thing that Proposition 13 was supposed to avoid put the counties in the most untenable of positions of having to pay more and offer more services that were not available through any other means because of the very thing their residents had voted for, and the people simply had no idea of that.

"The state continues to help pay the cost, but at a rate 30% below what it had been spending under Medi-Cal. Counties have to make up the difference. In Los Angeles county, the program change has caused about 40,000 people who had been treated at private facilities under Medi-Cal to turn to already strained county facilities. Thirty-three other counties contracted with the state to administer a program in which it pays private hospitals to care for the medically indigent."

That's quite fascinating, because then they take public dollars and contract out to private hospitals etc to pay for the care. While originally you had those counties running the hospitals themselves, they got out of that business. Why? Because they couldn't afford it, and then when they realized the effect it was having on the population, they turned around and spent those same state dollars paying the private sector to offer the service. What are the chances, do you think, that they were going to pay more or less? When you have a government or a non-profit run that facility without the opportunity of a profit margin to be considered, the private sector will always be more expensive.

How is this related to Ontario and the issue of referenda that would allow a Proposition 13 to happen in the province? Let's look at what's going on today. We have the consortium of IMOS, which has now taken over the maintenance of the southwestern highways, so the 401 comes right into Windsor. It does the salting, does this, does the other. I'll give you a perfect example to bring it home to you.

When you do the run between LaSalle and Amherstburg, the salt truck from MTO used to come along that road and throw salt every time it had to.

Mr Clement: On a point of order, Mr Chair: Is the salt truck germane?

The Chair: I would again caution the member to keep her remarks confined to the question at hand.

Mrs Pupatello: Highly germane, and I'll just explain how germane it is: This change from not just publicly funded but publicly organized and administered that happened in California went from public to private. Was it any cheaper? Why is that germane? Because they were forced to do so because California allowed for referenda.

Not only that, the similarity is striking because in Ontario we're already having to make these kinds of decisions. When you ran your car from LaSalle to Amherstburg in Essex county, the townships along that run were charged an average of $900 a year to throw salt every time we had a storm. Today, now that those roads have been privatized for the maintenance contract through the consortium of IMOS, they are being charged $20,000 a year. Do you know how many people live in the town of LaSalle? Some 20,000 people. That's a buck a year for every person in LaSalle who is now going to pay to deliver the salt on those roads that MTO used to do for $900.

The reality is that $900 was probably never enough, and the Ministry of Transportation should have wised up a long time ago to charge a very reasonable cost and fee for delivering salt on the road the whole year; $900 really doesn't seem enough to me. But $20,000, isn't that interesting? The moment the public service is turned over to the private hand, when you have to include the profit margin in the deliberation of what your invoice will be, the amount will always be higher.

That is the point. That is exactly why it is germane to this argument: The government of the day in California was forced to make those kinds of choices. They were forced to say, "We must provide the service because we were elected on the kind of agenda that talked about public safety, but now we never have the financing or the revenue that would allow us to provide the service."

What was the answer? The answer is that the private company is now charging $20,000 to every township in the county of Essex that is going to get salt thrown on the road every time there's a snowstorm. Isn't it fascinating that Ontario is already headed down that highway, and we haven't even brought forward our Proposition 13, because we are still in the argument of allowing referendums in the province? That is why the salt on the roads is very germane to the argument we're having at the time concerning bringing in referendums in Ontario.

This issue of what the health service is like is critical. As the restructuring committee makes its way around Ontario, today's announcement was Pembroke; in last week's announcement or two weeks ago it was Thunder Bay; before that the bulldozer hit for the first time in Sudbury. Nevertheless the answers, after it's finished, are always the same: less service. How strange it is that the commission always comes up with less. Do you think those commissioners who sit on that restructuring committee go there with the intention of cutting? I think not, because they're given the same document the rest of us got during the last election: "Not one cent from health care."

The fiscal reality of what's currently happening in Ontario is actually quite simple: You can't have your cake and eat it too. You can't balance the books without finding major sources of funding in the area of health, so one has got to go. Clearly the government is choosing that the place to go is health.

What happened after Proposition 13 hit California? Those kinds of choices were also there for the legislators and the local governing people of California. They had to start choosing, and what did they choose? You would think that our current restructuring commission is like a throwback to the state of California. Everywhere they went, they closed things. In every hospital they visited they shut down beds; they closed down whole hospitals. It didn't matter if it was the only hospital in that county in California; they shut it down.

Let's liken this to now, today in Pembroke. That was the only hospital in Pembroke and they shut it down. You guys were on this kind of textbook long before I ever got my hands on it. We're already travelling down the same highway, even before we're going to allow a referendum to hit Ontario. A Proposition 13 is going to hit Ontario faster, it's going to make our heads spin probably faster than the young girl's in the movie, the Exorcist. In any event, "The patient load in the remaining county hospitals continues to rise." Now we're back in California. Why would the patient load continue to rise?

Mr Hastings: A point of order, Mr Chair: I don't want to characterize the Exorcist in a bad light. I'm wondering whether the member isn't making rather questionable allusions to that movie in the context of what she's talking about. I think she should reconsider her remarks in that light.

The Chair: I again caution the member to make sure her comments are specifically in reference to the question at hand.

Mrs Pupatello: Yes. My reference was simply to the speed with which our heads would spin. I withdraw that because it's probably offensive.

Mr Hastings: Thank you.

Mrs Pupatello: "The patient load in the remaining county hospitals" -- don't forget. Likened to Ontario, where did the hospitals that closed in the counties that only had the one hospital go? Clearly they headed for other hospitals, and that's exactly what happened in California. Expect the people of Pembroke to start to travel. Where are they going to go when the hospital is no longer in Pembroke? They're going to move elsewhere. The same thing that happened there is going to happen in Ontario.

The Chair: It being 6 of the clock, the committee is adjourned.

The committee adjourned at 1800.