30th Parliament, 3rd Session

L057 - Thu 13 May 1976 / Jeu 13 mai 1976

The House met at 2:03 p.m.



Mr. Renwick: Mr. Speaker, on a matter of privilege, may I ask how the Sergeant at Arms, Maj. Soame, is doing?

Mr. Speaker: Thank you for your inquiry. He has been having certain physical difficulties. He’ll be back with us shortly, we hope. He’s supposed to go to the doctor today. He’s coming along.

Mr. Renwick: Thank you.

Mr. Speaker: Statements by the ministry.


Hon. B. Stephenson: Mr. Speaker, yesterday I announced an independent investigation of medical staff-administration relationships, with particular reference to the child and adolescent unit, would be made at the Lakeshore Psychiatric Hospital. The Ministry of Health is endorsing the request of Mr. William Jappy, who is director of the psychiatric hospitals branch, for an outside team to assess the overall situation at the hospital.

Mr. Jappy has asked the Ontario Medical Association and the Ontario Hospital Association to appoint an independent team to assess the situation at the Lakeshore Psychiatric Hospital and make recommendations based upon their findings.

Both the Ontario Medical Association and the Ontario Hospital Association have agreed to comply with this request. The appointees, however, have not as yet been named. It is expected that this investigation will take a few days. It is also expected that the recommendations of the team will be made shortly after the completion of their assessment.


Hon. Mr. Handleman: Mr. Speaker, on May 6, the hon. member for Riverdale asked me a question concerning the Ontario Securities Commission. I’d like to reply by way of a statement rather than losing the valuable time of the question period for this purpose.

The question was prompted, I believe, by an unsigned letter sent to the members of this Legislature. I, too, had received a copy when the question was asked, but at that point had not had the opportunity to study it.

I’m referring to the letter dated May 6, purporting to be from an Ottawa public servant, which talks about -- and I quote: “The unfettered powers of the police, and more particularly, the civil service in the field of wiretapping.”

The letter went on, and again I quote:

“While most such activity is merely frivolous, such action, in a substantial number of cases, is undertaken for personal reasons, often linked to profit.”

Appended was a package of documents, purporting to be letters, dated between July 28, 1966, and April 30, 1970, exchanged between the US Securities Exchange Commission and the Ontario Securities Commission.

OSC investigators are currently conducting an extensive investigation into these documents and earlier this week I received a preliminary report from OSC chairman, Mr. Arthur Pattillo.

In brief, the report points out inconsistencies in names, titles, dates, letterheads, addresses and file numbers as well as the obvious applications of paste-pot and scissors.

Mr. Pattillo’s report does not deal in general terms. It deals with each specific document, one after the other, and in document after document the inconsistencies recur.

To give one example, a number of the letters are allegedly written to or by a Mr. Harold S. Bray; once the director and now vice-chairman of the OSC. Well that’s close but no cigar. We have a Harry Bray. He was a director and is now vice-chairman of the OSC. His name is Harry because he was christened Harry. People call him Harry. He signs his letters Harry, because that’s his name.

And, lest he might have become confused and forgotten who he was at one point or another, we checked the signature. It’s an obvious forgery.

I think the point has been made and I don’t want to belabour it any longer or take up any more of the time of the House, except to make one comment. Obviously, a lot of time and effort and some cost went into this amateurish and unconvincing forgery. I have been asked --

Mr. S. Smith: You do a better job than Interpol.

Hon. Mr. Handleman: -- who could have done it. We don’t know who could have done it. The point is, we don’t even understand why but we intend to pursue this matter until we do find out and make sure that appropriate steps are taken.

Mr. Singer: MacKay from Ottawa might help you.

Mr. Peterson: Hire some plumbers.


Hon. B. Stephenson: Mr. Speaker, on May 6, 1975, the then Minister of Labour announced a programme of assistance measures for workers in Elliot Lake who had been adversely affected by exposure to air pollutants during employment in the mines. That programme is now fully operational under the administration of the Workmen’s Compensation Board.

I am now pleased to announce that the Workmen’s Compensation Board has approved a similar assistance programme for workers with asbestosis or related chest conditions and for those classes having asbestos fibre dust effects but not asbestosis.

Those workers already diagnosed as having asbestosis and still employed in exposure will be actively encouraged to leave exposure employment for other work. Such workers will be assisted during the transition period with compensation based upon a difference in earnings. In addition, rehabilitation and retraining assistance will be provided by the board and if resettlement in another community is necessary a relocation expenses grant will also be paid as a rehabilitation measure.

Following substantial investigation and research by the board’s consultant in chest diseases, Dr. Charles Stewart, and his colleagues at the board in consultation with the experts of the advisory committee on occupational chest diseases, criteria have been established for identifying asbestos fibre dust effects in asbestos workers who do not have asbestosis. Such workers will also be encouraged to seek non-exposure employment. While in the absence of disability, entitlement to disability compensation cannot be established, entitlement will be provided to substantial rehabilitation assistance allowances, including vocational retraining and, if necessary, resettlement elsewhere.

As with the Elliot Lake programme, the board will ensure that any future claims cost related to such workers’ exposure to asbestos will not be charged to the new employers.

Arrangements are being made by the board for the programme to commence in Scarborough on June 14, 1976. Approximately 36 workers from Canadian Johns-Manville with indications of asbestos fibre dust effects will be interviewed during that week. Subsequently, representatives of the board will visit other locations in Ontario as necessary to provide assistance under the programme to affected workers throughout the asbestos industry.

The board will work closely with both the industries and the unions involved to ensure that each individual worker affected who wishes to participate in the programme receives every consideration, and the workers may have union representatives present at the interviewing stage to assist them.

This new and comprehensive programme is, I believe, the first of its kind in North America and represents a further major innovation by the Workmen’s Compensation Board in providing assistance to industrial workers in this province.


Hon. Mr. Parrott: Further to my statement of May 4 regarding higher fees to foreign students and my subsequent reply to questions asked by the member for Wellington South (Mr. Worton) and others, I would like to reiterate our understanding that assistance to developing countries is a federal responsibility. I have already indicated our desire to discuss this matter with the federal government. Today, however, I would like to indicate that in these discussions Ontario is prepared to make a very positive definite proposal.

We are prepared to absorb the cost of the tuition surcharge applied to foreign students in Ontario post-secondary institutions who are sponsored and financially backed by the Canadian International Development Agency. Most federal government assistance to students from developing countries is administered by CIDA. In one of their programmes, for example, students from developing countries are awarded up to 6,000 in a calendar year for fees, books and other education and living expenses.

We understand that these students are highly qualified and deserving of our support and ultimately will return home to assist in the development of their own countries. Of a total of 1,700 CIDA-sponsored students in Canada, we expect that approximately 500 students will be assisted by Ontario.

I’m sure the hon. members will also bear in mind that even foreign students of an unsponsored type, who will be required to pay increased tuition fees, will still be heavily subsidized by the Ontario taxpayer.

Mr. Speaker: Oral questions.


Mr. Lewis: You’re getting there. I have a question; first, if I may, to the Premier. It may be a clarification. Now that Chesley Hospital has reopened its doors, begun admitting patients and taken back its staff, can we assume, can the public assume and can the hospital assume it will be given the same considerations of funding for an additional six months as was described here in the House earlier this week?

Hon. Mr. Davis: I think that’s a very reasonable assumption for the Leader of the Opposition to make. As I pointed out, I believe on Tuesday, the Chesley board was meeting and that certainly as far as the government was concerned it would be prepared to discuss the future of the hospital with that particular hospital board. I’m sure the ministry will be doing that on the understanding that it falls within the same guidelines as the other institutions that have been affected; and we’re talking about a six-month period at this moment.

Mr. Lewis: Good. A small step for the Tory party.


Mr. Lewis: A question, if I may, of the acting Minister of Health, Mr. Speaker: Can the acting Minister of Health give us some sense of the terms of the inquiry into the Lakeshore Psychiatric Hospital that is being conducted by the medical establishment? What do they intend to look into?

Hon. B. Stephenson: The inquiry is scarcely being conducted by the medical establishment. The components of the team are both members of the Ontario Hospital Association and the Ontario Medical Association. It will be an inquiry, I would judge, much like those that have been carried out by similar teams into the problems arising within general hospitals within the province where there seems to be a problem of communication or difficulty between staff and administration. We hope their recommendations will be of assistance to us.

Mr. Lewis: By way of supplementary, if I may briefly, is the minister going to provide some perspective for the inquiry team or the Legislature as to their terms of reference? For example, is the inquiry largely to look at the problem of the unhappy admission of the 14-year-old boy to an adult ward for a month and what occurred? Is it to look at the transfer of the child unit to Thistletown and the implications for the adolescents who remain? Is it, perhaps, finally, to “get” Dr. Marcilio, as many of us suspect has been the inclination of some of those in the senior administration at Lakeshore, and this will be the apparatus which finally removes him from the hospital system? What are the terms of reference? Who will the witnesses be? How will it be held?

Hon. B. Stephenson: I can’t give details about how the inquiry will be conducted because this will be a decision which is made by those members of the team who are involved, as to the most appropriate method of carrying out the inquiry. However, I think all of the problems mentioned, except perhaps the specific problem of Dr. Marcilio which the hon. Leader of the Opposition has defined in one specific manner, will be part of the terms of reference to this committee.


Mr. Lawlor: A supplementary, please: How far back in time, perhaps to the inception of Dr. Bond coming into office, will this commission go? Secondly, is it within their terms of reference, as the minister understands them, to investigate various treatment methods used for children?

Hon. B. Stephenson: I’m sorry, Mr. Speaker. I didn’t hear the hon. member’s final sentence.

Mr. Lawlor: I’m concerned about treatment methods, which is a moot point at that hospital, and it is within the ministry as to how children are treated; is that part of the survey to be conducted by this commission?

Hon. B. Stephenson: Mr. Speaker, perhaps if the members of the team feel this is an appropriate part of the study, they will include this. I would think they will extend their investigation back as far as they feel it’s necessary to do so in order to determine all of the reasons for the present state of unrest within that institution.


Mr. Lewis: A question, if I may, of the Premier, relating to the copyright story in the Globe and Mail this morning. Can the Premier address himself to or comment upon that? On the face of it, it certainly appears to be a strange conflict of interest on the part of a gentleman who is paid an actual amount of money by a government ministry on a monthly basis and then receives, through a private agency, an additional commission on top of that? In the one case he acts as an adviser on the ethnic press and in the other case as the placer of advertisements in the ethnic press. Does it cause the Premier some concern as to the propriety of the arrangement?

Hon. Mr. Davis: Mr. Speaker, I would suggest to the Leader of the Opposition that the Minister of Industry and Tourism (Mr. Bennett), within whose ministry this programme is situated, is quite up to date as to the facts and the information and is more than prepared to answer the questions.

Mr. Bounsall: A supplementary.

Mr. Speaker: You can try it.

Mr. Bounsall: As a matter of general government policy, is the Premier willing to write into the contracts the government has with advertisers or printers or anything else that applies, upper limits to which they might charge additional fees to the recipients of their services or spell out in detail what they are or are not allowed to do in the way of further charges?

Hon. Mr. Davis: Mr. Speaker, I really don’t regard that as a supplementary. The Leader of the Opposition, I know, would like an answer to his initial question and in that the Minister of Industry and Tourism is prepared to answer that question, if the hon. member feels that is a supplementary at that stage, I’m sure the Minister of Industry and Tourism would be delighted to answer that.

Mr. Cassidy: Why don’t you keep him out of the House?

Mr. Lewis: I’ll be pleased to ask the Minister of Industry and Tourism when he’s here.


Mr. Lewis: Can I ask the Minister of Transportation and Communications if he is aware of a major sand and gravel licence given to, I think Regan Sand company, and leased in turn to Armbro of Brampton, for a large wayside pit in Uxbridge township to furnish Highway 401? Is it the habit of the Ministry of Transportation and Communications to give approval for such pits, which may be in direct contravention of the official plan, without letting the municipal or regional people know?

Hon. Mr. Snow: Mr. Speaker, I am somewhat aware -- I don’t have all the details regarding the particular matter. A contract was awarded for repaving work on Highway 401 to Armbro Construction. It is my understanding -- it is the policy of the ministry to issue permits for wayside pits in connection with particular construction projects. Of course, all the normal rules and regulations and rehabilitation clauses and everything, I’m sure, are connected with that particular pit.

I understand there was some concern. I believe our contract for the construction called for certain work to be carried on in off-hours in order to eliminate as much as possible the conflict with traffic on the highway. This created another conflict by having the trucks hauling the gravel in these off-hours and it’s created a nuisance to residents in the area. I believe the contractor and officials of my ministry have been able to work out some adjustment in the scheduling to allow the contractor to proceed normally and to eliminate the need for hauling in these off-hours.

Mr. Sargent: With regard to Armbro --

Mr. Cassidy: You are back.

Hon. Mr. Snow: Welcome back. Nice tan.

Mr. Lewis: Did the member for Grey-Bruce hear they are reopening hospitals?

Mr. Sargent: The Leader of the Opposition can’t argue with success.

Mr. Lewis: Touché.

Mr. Speaker: Order.

Mr. Sargent: Related to the Armbro matter, is my information correct in that the ministry paid $9 million to Armstrong Brothers for land acquisitions for the parkway belt west regions? Is that figure correct or not?

Hon. Mr. Snow: First of all, I don’t see where that question is supplementary at all to the matter relating to a wayside pit at Whitby.

Mr. Speaker: I am sorry, I didn’t hear the supplementary question. Is this a supplementary to the original question?

Mr. Sargent: I am trying to find out, Mr. Speaker.

Mr. Speaker: Let’s hear it.

Mr. Sargent: Was an amount of money, in the neighbourhood of $9 million, paid for a gravel pit or for land acquisition?

Hon. Mr. Snow: If I may clarify this situation, the hon. Leader of the Opposition asked me a question regarding a wayside pit in Pickering.

Mr. Sargent: Does the minister know or not?

Hon. Mr. Snow: The supplementary question, I believe, refers to land in the parkway belt west, which is perhaps 30 miles away.

Mr. Shore: Close enough for a supplementary, though.


Mr. Lewis: Could I just redirect a question to the Minister of Industry and Tourism that I asked of the Premier? Can the minister express a view upon and is he concerned about the apparent conflict of interest in paying someone from his ministry $800 a month to advise on the ethnic press and then that same individual being paid a commission for the placement of advertisements in the press? Does the propriety of that concern the minister as it concerns me, for example?

Hon. Mr. Bennett: No, it does not. The simple reason is that the individual we retained is to advise the ministry on placing of advertisements in the ethnic press and to assist in the translation from English to whatever language it happens to be that we are placing ads in whatever ethnic press. There are some 70 in the province. He is a direct adviser to us and that is all. The final determination as to whether ads will be placed in a particular press or newspaper rests entirely with the ministry.

Mr. Cassidy: That’s pretty thin.

Mr. Lewis: I just want to understand. Is the minister suggesting that Mr. Kowalski does not place advertisements in the press as he has indicated he does, and get a commission from them? Does the minister not feel that it would be better to have one or the other job given to this man rather than both, particularly since he has even demonstrated publicly, political preferences in the way in which he regards the ethnic press, which is something, I am sure, that would horrify the Premier, given his observations on ethnic matters?

Hon. Mr. Bennett: First of all, Mr. Kowalski happens to be an advertising agency operating in the Province of Ontario and has in his agency under contract certain ethnic newspapers across the province --

Mr. Sargent: He is not even listed as an agency.

Hon. Mr. Bennett: -- as well as radio stations and television stations. He has been an adviser to us on a fee basis as to where we should be placing ads. I have already said clearly that we make the final decision as to where the ad will go. Mr. Kowalski is in the private sector as well. He is paid a regular commission, as are all other advertising agents who happen to handle advertising, either in the ethnic press or in the standard press of this province.

Mr. Singer: Supplementary: I wonder if the minister could advise us, in view of what appears to be a very large sum of money that Mr. Kowalski receives because of his peculiar position, and even though it didn’t do the Tories much good having him in that position, whether it wouldn’t be a very substantial saving of public money if this job was done within government and by a civil servant who was trained for the purpose, particularly bearing in mind that Ontario already has a translation service which it makes available to all members concerned with that kind of service?

Hon. Mr. Bennett: Mr. Speaker, first of all there is the sum of money; and there was some $435,000 spent in advertising in the ethnic press. May I say in regard to the ethnic press, there is none that is more complicated and difficult to handle, not only because of opposition members, but because of members in our own party who constantly want us to place ads in the ethnic press, where they should rightly be, and where the people of other languages should be informed of the services of the government of their province -- and we believe it’s our responsibility. But it is a most difficult situation, because everyone and his brother thinks he’s got another press that’s valid and should be recognized.

As far as the approved sum of money is concerned, Mr. Speaker --

Mr. Singer: It didn’t do you much good. You elected very few members in that portion of Toronto.

Mr. Speaker: Order, please.

Hon. Mr. Bennett: -- not all of it is spent in the printed media. About half of it is spent in the printed media, the balance in radio and television. As far as in-house services are concerned, if I had thought, sir, that it would have been loss expensive for this government to retain the services in-house for the translation services, the placement services and the individuals who deal with the ethnic press on a day-to-day basis, we would have done so. We do not believe it. We believe it’s better to have it contracted out.

Mr. Bounsall: Would the minister not agree that the commission fee at 30 per cent that’s being charged by Mr. Kowalski is indeed a little rich, and would he not agree that contracts being let for advertising through his ministry have minimum standards written into them, or maximum amounts on what the commission fee can be?

Hon. Mr. Bennett: Mr. Speaker, as far as commissions are concerned, that’s between the agent and the newspaper that he happens to be working on behalf of or for. While the commission rate in this particular case is 30 per cent, I am under the impression that the others working in this field are charging 35 and better for placement of advertising --

Mr. Singer: Oh, that’s good.

Mr. Breithaupt: That certainly makes it right.

Hon. Mr. Bennett: -- but the final determination as to the percentage paid to a particular advertising agent rests entirely between the agency and the newspaper. It is not paid for, Mr. Speaker -- may I underline this -- the commission is not paid for by the province. We buy the advertising predicated on the preferential linage cost. The commission is paid for by the newspaper that he happens to be dealing with.

Mr. Singer: This government allows the system.

Mr. Cunningham: Would the minister be inclined to tell us, or investigate and report to the House, whether or not this individual and his franchised advertising agency are recognized by the advertising industry in the Province of Ontario?

Hon. Mr. Bennett: Yes, I will, Mr. Speaker.

Mr. Cassidy: It is like having a Ford car dealer advise us on the purchase of automobiles.

Hon. Mr. Bennett: Your outfit is the one --

Mr. Speaker: Order, please.

Mr. Sargent: What about all those kickbacks?


Mr. S. Smith: I have a question, Mr. Speaker, for the Minister of Energy, if I might: Now that a senior official of Ontario Hydro, one Phillip Stratton, director of corporate services, has apparently confirmed the information I gave the House a few days ago concerning the failure of Tippet-Richardson to fulfil the terms of its contract, can the minister tell us what steps he is going to take to make sure the employees who work on the contract are paid in accordance with the conditions of the tendering and the contract itself; and can he tell us also what steps he is going to take against the moving company for its failure to live up to the contract under the tendering rules?

Hon. Mr. Timbrell: Mr. Speaker, I am very glad the leader of the third party asked the question again. I was prepared to give the answer to him today. Following his initial question on Monday, I did investigate and I found the following:

At the commencement of the moving contract, the successful tenderer informed Ontario Hydro of the labour rates it would pay for this work. At that time, such rates were in conformance with prevailing collective agreements for the trades involved.

I might add that it is a requirement of Ontario Hydro that current rates be maintained throughout the course of the contract. At the conclusion of the work performed under contract, the contractor submitted a signed statement certifying that it had complied with Ontario Hydro’s requirements regarding the employment of labour.

As a result of a challenge to this matter from one of the unsuccessful bidders, Hydro instituted an investigation in early April, which has confirmed that the labour requirements were not fully met. The investigation is continuing, during which time Hydro is withholding moneys otherwise due to the contractor. It will be Hydro’s intention to resolve the matter in such a way as to achieve conformity with its labour requirements.

Mr. S. Smith: By way of supplementary, can the minister not see that the whole tendering process is called into question when one of the companies is able to bid on a basis different from what the other companies expected the game to be, and if everyone knew they had to pay the rates they were supposed to pay, the bidding might have been a bit different?


Hon. Mr. Timbrell: No, I disagree that in any way suggests the tendering process is deficient. Hydro does require, as I indicated, that the wages paid he in conformity with existing union contracts for the same trades. It does require them to file a signed statement that they did conform with those requirements.

In cases such as this, when Hydro finds that statement was not correct or not true, it withholds money -- in this case many tens of thousands of dollars -- which more than covers what is involved in the difference between the required rates and what was actually paid to some of the employees.

Mr. S. Smith: May I ask the Attorney General, in view of the fact that this contract has been breached, according to the Minister of Energy, if he feels his office will look into whether charges should be laid under any particular section of the Criminal Code?

Hon. Mr. McMurtry: I’m sorry, Mr. Speaker; I didn’t hear the Minister of Energy state that there had been any breach of any contract.

Mr. Speaker: Are you going to direct the question of the Attorney General?

Mr. S. Smith: A supplementary: Not to waste the time of the House, will the Attorney General undertake to check with the Minister of Energy about this matter and report to the House?

Hon. Mr. McMurtry: Yes.

Mr. S. Smith: Thank you.


Mr. S. Smith: A question for the acting Minister of Health. With regard to the matter of the lockout of the public health nurses in the Pine Ridge-Haliburton area, which we discussed a few days ago, is the minister aware that one Mr. John Starr was appointed by the government to be on that particular board, that the vote to lock out the nurses was a unanimous vote and that he was present at the meeting during that vote? Can she tell us, therefore, how she can justify his behaviour and whether she is undertaking to take any action in this regard?

Hon. B. Stephenson: Mr. Speaker, as I reported to the House on at least two occasions, we have been attempting to take some action. There is a meeting this week of boards of health of the Province of Ontario to which the ministry is making representation in order to attempt to persuade them that there must be a solution found to this problem as rapidly as possible. I am still attempting to find out why that specific board of health decided to take that course of action and I’m afraid I do not have that information as yet.

Mr. S. Smith: Thank you very much.


Mr. S. Smith: In the absence of the Minister of Community and Social Services (Mr. Taylor) I think the provincial secretary for that ministry is around, is she not? She’s beside the Attorney General.

If I may just ask the question while she is returning to her seat; will the minister confirm a report that unclassified staff in the Smiths Falls mental retardation facility are going to have their salaries cut by 40 cents an hour, in addition to losing unused sick credits, effective from June, and unused holiday time, effective from September? Can she tell us, if she can confirm this, how many staff are involved and whether the staff have been told that they face dismissal if they protest this action?

Hon. Mrs. Birch: Mr. Speaker, I would reply to the hon. member that I’m not aware of that but I will make every effort to get the information and to see that it is reported.


Mr. S. Smith: A question for the Premier. Could he assist the citizens of Ontario by lessening their curiosity about what went on between him and his confrere from Alberta, Premier Lougheed?

For instance, could he tell us what his answer was to Premier Lougheed when he suggested the Premier could reduce the Ontario tax on fuel oil as a way of saving the necessary jobs which are very much required in this province? Could he also tell us whether he had an answer for Mr. Lougheed when he said that if he didn’t increase his oil prices he’d keep the oil in the ground? Could the Premier tell us what his answers were to Premier Lougheed in these matters?

Hon. Mr. Davis: Mr. Speaker, I’m going by memory once again but I rather think I answered that same question -- the first one -- either to the hon. member who has just asked the question or the gentleman on his left last Friday morning, as a matter of fact.

Mr. Martel: Playing tennis again?

Hon. Mr. Davis: I think I answered that specific question and if the leader of the Liberal Party would search through Hansard I think he would find my reply.

Mr. Nixon: I might assure the Premier there was no reference to the threat from Alberta that the crude would be left in the ground.

Hon. Mr. Davis: No, but I was referring to the first question, where I think the former leader of the Liberal Party -- and I may be wrong on this -- asked me --

Mr. S. Smith: What was said to Lougheed?

Hon. Mr. Davis: -- no, no, asked me about the Premier of Alberta’s observations about the tax, and I think I gave a reply.

Mr. Nixon: The question was what the Premier said to Lougheed.

Mr. Speaker: Order, please. The hon. Premier has the floor.

Hon. Mr. Davis: I told the hon. member exactly what I said to the member for Brant-Oxford-Norfolk. We don’t intend to lower our tax; it’s as simple as that. With respect to -- what was the other observation made -- a threat to what?

Mr. S. Smith: Keep the oil in the ground.

Hon. Mr. Davis: Keep the oil in the ground? I don’t really recall him making a threat to keep the oil in the ground.

Mr. S. Smith: By way of supplementary: Is it the Premier’s understanding that Premier Lougheed has at any time said to any official, either of this government or the Canadian government, that if he did not get an increase in his oil price sufficient to meet his particular desires, he would keep the oil in the ground and give Ontario a dry pipeline at the end of the pipeline in Sarnia? Is the Premier aware that he has ever made that suggestion, or that his officials have ever made that suggestion, and what has been the Premier’s answer to him on that matter?

Hon. Mr. Davis: Mr. Speaker, I have to confess to the leader of the Liberal Party that I have not been privy to all of Premier Lougheed’s conversations with the first minister of Canada. Actually, the member for Hamilton West has seen him since I have and perhaps he would have made that observation to the member.

Mr. S. Smith: That’s right. He gives the Premier his best regards.

Hon. Mr. Davis: Perhaps the first minister and the member settled all of this in that delightful luncheon the day after. That’s when I answered the question to the member’s colleague with respect to the first question he asked today.

Mr. S. Smith: True enough, but the member for Brampton is still the Premier, of course.

Hon. Mr. Davis: I can’t comment on what the Premier has said to any official, when I have not been there.

Mr. S. Smith: Quite a fan club they have over there. They need each other.

Hon. Mr. Davis: I can only refer to anything that the Premier of Alberta has said in my presence. I think the leader of the Liberal Party would understand that as being fair and reasonable, and while I --

Mr. Lewis: Does it never end? Sit down.

Hon. Mr. Davis: Well, you know, a question of this kind deserves an answer of this kind. I can only say that the Premier of Alberta, as I think the leader of the Liberal Party would understand, is endeavouring to make the best arrangements for the people he represents. I think he is anxious to obtain that which he feels is reasonable and to which he thinks the citizens of Alberta are entitled.

I would have to say to the leader of the Liberal Party that I happen to disagree with the Premier of Alberta as to what that amount should be. This has never been a secret. And if it helps him any, I will say it here again publicly: I do not agree on the $2 request from the Province of Alberta. I have always found, too, that --

Mr. Lewis: What a revelation.

Mr. Singer: Can you elaborate on that?

Hon. Mr. Davis: Mr. Speaker, to elaborate further on that point. To elaborate further -- no, I can’t really say, in the context in which the leader of the Liberal Party has phrased the question, that the Premier of Alberta has threatened to have a dry pipe to Sarnia. I don’t ever recall the phrase “a dry pipe to Sarnia” being used by the Premier of Alberta.

Mr. S. Smith: Never heard of it -- nor have any of his officials ever heard of it.

Mr. Hodgson: Try again.

Mr. S. Smith: Mr. Speaker, thank you very much. It is just wonderful to hear these answers. You know, if he and his fan club here didn’t have each other, they would have to invent each other -- because they require each other.

Mr. Speaker: Does the hon. member have further questions?


Mr. S. Smith: Yes, a final question to the Minister of Housing: What recommendations has the minister received from the Ombudsman with regard to the Ombudsman’s investigation into certain aspects of the North Pickering project -- namely, the practices and procedures in acquiring land? What action does he propose to take following his meeting yesterday with the Ombudsman?

Hon. Mr. Rhodes: Mr. Speaker, I have received no recommendations from the Ombudsman as yet. The action I am taking following the meeting is to wait for the report to come to me.

Mr. S. Smith: By way of supplementary: Will the minister give an undertaking to this House that he will table the Ombudsman’s report and the recommendations?

Hon. Mr. Rhodes: Mr. Speaker, I think the procedure is that the report will be made to my ministry, at which time we will have an opportunity to study it, consider the recommendations and recommended action, and it possibly can be made public at that time, yes.

Mr. Shore: Either shred it or do something else.

Mr. Good: You can always appeal to the Supreme Court.

Mr. Lewis: Does the minister not realize a copy of that report also goes to the member for Durham West (Mr. Godfrey) as one of the complainants, and that he should discuss with him its tabling as well?

Hon. Mr. Rhodes: I’m quite aware of what the requirements are as they relate to the report that the Ombudsman may make on any particular matter. I am well aware of the fact that those persons who are listed as complainants will be receiving copies of that report as well. The hon. leader of the Liberal Party is referring to what I was going to do with my copy.


Mr. McNeil: I have a question of the Minister of Transportation and Communications. Is the minister aware of the differential in the price of gasoline between highway service centres and off-highway service stations and does the minister propose to take any action?

Would the minister also indicate the effect of government leases with oil companies on the prices charged for gasoline at service centres in view of the increases in federal excise tax and fuel prices generally?

Hon. Mr. Snow: Yes, I am aware of a substantial differential between the prices charged. I believe there are 23 service centres on our expressways. I am aware of the higher prices they are charging. We are looking into this matter now and I hope to have some recommendations for the government to consider that might alleviate some of this situation.

These service centres are operated under a lease agreement with the oil companies which tender for the award of these leases, and the lease agreements call for a percentage of gross sales, not a per-gallon rate. When most of these leases or contracts were drawn up -- some of them quite a number of years ago -- fuel was at a much more reasonable price than it is today. As the costs have increased, and especially since our friends in Ottawa have increased them by another 10 cents with their further excise tax, this increases the sale price and, consequently, increases the amount paid for the lease, as it is a percentage of gross sales.

Actually, the revenue that the Province of Ontario is receiving for these leases has gone up considerably with the price of the fuel. This was not the intention. We are looking into some way that we may be able to alleviate some of this situation.

Mr. Ruston: Does the minister in considering this realize that at the King centre on Highway 400 the rate of commission is 20 per cent so that the province is also picking up about nine cents a gallon, plus its regular tax? In effect, the station there is paying 29 cents and 3½ cents federal sales tax, plus nine cents commission, or over 40 cents a gallon in tax.

Hon. Mr. Snow: I have a little trouble following the hon. member’s question. The gasoline tax is the same at that station as it is at any other station within the province; we all know that. But if the hon. member had been listening, he would have heard me say a moment ago that our rents for the leases under the service station arrangements on this freeway are based on a percentage of gross sales. Because our friends in Alberta and our friends in Ottawa -- and Saskatchewan, too -- have decided to increase the cost of fuel so much and because the hon. member’s close friends in Ottawa have added that extra 10 cents a gallon tax, naturally the cost of the lease goes up, because it is based on gross revenue, as I told the hon. members a few moments ago.

I think the hon. member’s question was totally answered in my answer to the question of the member for Elgin.

Mr. Speaker: A final supplementary, the member for Etobicoke.


Mr. Philip: Can the minister assure members of this House that his timetable for recommendations to the cabinet is at least a little bit faster than the timetable by the Minister of Energy (Mr. Timbrell) or the Treasurer (Mr. McKeough) in the recommendations that they have been going to bring to cabinet for months in related areas?

Hon. Mr. Timbrell: You know very well that we’re waiting for the commission.

Mr. Philip: By then the dealers will be bankrupt.

Mr. Speaker: Order, please.

Hon. Mr. Snow: Mr. Speaker, I don’t know what related areas the hon. member is speaking about. This particular matter relating to the price of gasoline at the service centres on the freeways is of concern to me; it’s of concern to my colleagues on this side of the House.

I have had a full investigation of the leases. The leases vary greatly in percentages and in terms and, as I say, our revenue for the leases has gone up considerably because of the increase in the price of fuel brought about by others than those on this side of the House. We’re looking for some way of coming up with a formula or an adjustment in our lease arrangement, because all we’re really looking for is the normal return we had anticipated on the normal price of gasoline, not on a highly inflated price brought about by others.


Mr. Cassidy: I have a question of the Minister of Consumer and Commercial Relations. Does the minister consider the way rent review is being administered by his ministry is making the rent review process biased against tenants?

Hon. Mr. Handleman: No, Mr. Speaker.

Mr. Cassidy: If not -- since the minister says no, can he explain --

Mr. Renwick: If not, why not?

Hon. Mr. Davis: Mike, you’re on camera.

Mr. Cassidy: -- why tenants are being denied the right to make their own copies of the landlord’s cost revenue material when copies are available to both the landlord and the rent review officer; why the rent review officers are harassing tenants at the hearings and in many cases cutting off their right to speak; and why the vast majority of the 73 rent review officers are from private business, including 20 with a real estate background, while only one has had the remotest connection with tenants’ interests and only three are women?

Mr. Breithaupt: What would have been the supplementary if he had said yes?

Hon. Mr. Handleman: Mr. Speaker, I don’t happen to have had the opportunity to review each of those questions in turn. With regard to the cost/revenue statement, it is available to all of the tenants to examine; they can take whatever information they want from it. There is no provision for copies being provided through our office. I don’t accept the allegation that the tenants are being harassed or denied the right to speak at hearings, and I would like to have specific examples rather than that kind of broadside type of allegation. And I don’t accept for one minute that the tenants are in any way being prejudiced by the programme at all.

Mr. Cassidy: Supplementary, Mr. Speaker.

Mr. Speaker: This is the final supplementary.

Mr. Cassidy: In view of that reply, can the minister explain why rent review rulings are averaging 19 per cent in Ottawa, and why these rulings are so far out of line with the 13 per cent average for the province and the eight per cent which the minister has said is an adequate increase in 1976 to cover landlords’ costs?

Hon. Mr. Handleman: First of all, it’s not a rent freeze, it’s a rent review programme, and at the very outset the whole concept of the programme was that cost pass-throughs would be allowed. The practice in Ottawa, as the member for Ottawa Centre knows quite well, is to have long-term leases, and many people in Ottawa are coming off three- and five-year leases; they can’t expect to settle for an eight per cent increase. The average of 13 per cent, of course, does not take into account any of those rent increases which have not gone to the rent review process, because they are under eight per cent.

Mr. Cassidy: Supplementary, Mr. Speaker.

Mr. Speaker: No, that was the final supplementary.


Mr. Sargent: Mr. Speaker, a question to the Premier: Since the Premier is the one who presses the button in most cases --

Mr. Sweeney: He’ll self-destruct, Eddie.

Mr. Bullbrook: We’ll just call him Dr. Strangelove.

Mr. Sargent: -- and he will have to explain to his party’s annual convention his irresponsible stand on hospital closings, and since I learned this morning that his government has squandered about $100 million to date this year on the parkway belt west and there is $28 million left in the pot, would he tell me how he can justify the closing of hospitals as part of his government’s restraint programme and how he plans to tell the 24 hospitals which he plans to close that he’s still going to close them?

Hon. Mr. Davis: Mr. Speaker, I’ll try to deal with the three or four questions that the hon. member, in his traditional and logical approach to these questions, has asked.

Mr. Sargent: I like your clothier. I like your suit.

Hon. Mr. Davis: I like your tie, too; I think it’s great. Where did you get it?

First, if the member is referring to the annual meeting, unlike his own party, it is a very open party that I have the honour to lead. He’d he welcome there this weekend.


Mr. Speaker: Order.

Hon. Mr. Davis: I’m not sure he would get to vote but anyway he is welcome and he can discuss the policy of the government as it relates to health services. I can’t give him the exact hour or where the panel is being held but he would be welcome there. We will look forward to seeing him there on Saturday afternoon.

Mr. Sargent: I’ll be there.

Hon. Mr. Davis: With respect to the acquisition of land by the government as it relates to the 24 hospitals, I really couldn’t quite follow the logic of this. I think I said very clearly in this House that there had been -- I’m going by memory again -- five or six hospitals plus two private hospitals about which an order in council had been passed with respect to closing. I don’t know what 24 this hon. member is referring to and I think I also made it abundantly clear there are no further hospital closings contemplated.

With respect to the acquisition of land in the parkway belt west, yes, the province is acquiring land, If the hon. member, as a representative and speaking for the Liberal Party of Ontario, says the Province of Ontario should not be acquiring land to preserve the neighbourhood integrity of the areas west of Metropolitan Toronto; if he feels that provisions should not be made for transportation corridors and those things which we think are pretty basic to curb the traditional approach to urbanization which has been experienced elsewhere, I would only suggest that he read the rather contradictory statements made by the leader of his party who one day is in total support of a partial freeze on farm land and the next day is opposed to it, depending on where he is, but is very concerned about the land-use policy. If the member for Grey-Bruce is saying that government should not be acquiring land for future generations --

Mr. Sargent: Why doesn’t the government block off parkway east then?


Mr. Speaker: Order; order please.

Hon. Mr. Davis: -- and trying to preserve the urban environment which we have, the quality of growth which we have experienced, let him say so. I only ask if he is speaking for the total Liberal Party in the Province of Ontario?

Mr. Nixon: Sorry, Bill, the lights are out.

Mr. S. Smith: It is the second time you have not told the truth in the House.

Mr. Speaker: Order, please. We’ve had enough unrelated questions. I think we’ll get on with the next one. The hon. Minister of Energy has the answer to a question.

Hon. Mr. Timbrell: Mr. Speaker, I gave the answer earlier to the member for Hamilton West.

Mr. Speaker: I’m sorry. The member for Sudbury East.


Mr. Martel: I have a question of the acting Minister of Health. Can the minister tell the Legislature who from the ministry contacted J. P. Lebel and requested his resignation? What form was used? Was that done by telephone, telegram or did the ministry write a letter to him?

Hon. B. Stephenson: Mr. Speaker, I wrote a letter to Mr. Roger Gionet asking him to notify all the then members of the board of that hospital to submit their resignations upon the recommendation of Judge Waisberg.

Mr. Martel: A supplementary question: Why then, on April 21, which was after the letter to Mr. Gionet, was a telegram sent by Alan Backley, Deputy Minister of Health, saying the following, “For your information, the legal members of the board of Laurentian Hospital are” and the first one listed is J. P. Lebel?

Hon. B. Stephenson: I’m sure there was a reason for listing the names alphabetically. However, I told the member yesterday --

Mr. Singer: Then you didn’t ask for the resignations? A supplementary --

Mr. Speaker: Order, please.

Hon. B. Stephenson: I told the member yesterday that there was an assumption that because two members, at least, of the then board had been originators of that hospital and had been members of the board from the inception, they might be legally constituted members of the board. That’s the only reason.

Mr. Singer: Why don’t you give us the right story? You can’t have it both ways. A supplementary.

Mr. Speaker: No, I announced that as the final supplementary. There are two minutes left for several more questions.

Mr. Singer: The minister has not given us the right story on that, not once.

Hon. B. Stephenson: I did.


Mr. Good: I have a question of the Minister of Housing. Since I understand there is no authority in legislation for municipalities to --


Mr. Speaker: I’m sorry, we can’t hear the hon. member. The question period is not over yet. The hon. member for Waterloo North.

Mr. Good: Thank you, Mr. Speaker. Since I understand there is no legal authority in legislation for the levying of charges when applications are made to a municipality for a zone change or a development agreement, is the minister proposing changes in the Planning Act which would legalize this practice, which is common among all municipalities I have checked so far?

Hon. Mr. Rhodes: No, Mr. Speaker, I am not at this time contemplating any changes in the Act to deal with that particular matter.

Mr. Good: Supplementary: Since this is a common practice and there evidently is no authority for it and municipalities do, in fact, have a lot of expense involved with these applications for zoning changes, doesn’t the minister think he should do something about it one way or another?

Hon. Mr. Rhodes: Mr. Speaker, this particular matter would probably fall into the area of a total fee examination as to what is being charged by municipalities for various types of services offered as it relates to dealing with land situations. I would think that perhaps we should review the whole question if there is this problem.

Mr. Speaker: The Minister of Consumer and Commercial Relations has the answer to a question.


Hon. Mr. Handleman: Mr. Speaker, On Friday, May 7, the member for Kitchener (Mr. Breithaupt) asked me a question regarding the lease arrangements made by the Liquor Control Board of Ontario for its store in New Liskeard.

I can report that during the year 1972, the LCBO’s committee for stores development investigated, surveyed and considered four suggested store locations in New Liskeard, and started negotiations for a lease with Pulkinghorn Developments Ltd. during January of 1973. The Pulkinghorn location, in a shopping centre at the corner of Cedar Ave. and Armstrong St., was considered the best of those inspected because of its location in the centre of town. The three other sites investigated were on the outskirts of town and the LCBO had received calls from local municipal councillors asking that the store be centrally located.

The LCBO entered into a 20-year lease with Pulkinghorn Developments Ltd. for the store at an annual rental of $20,304 per year. This rent was considered fair value at that time and commensurate with prevailing rents in the area. Looking back now, and considering the rates of inflation we have been subjected to over the last few years, the lease is becoming more attractive all the time.

In summary, Mr. Speaker, I would say the LCBO entered into an entirely reasonable lease at a most desirable location in the town of New Liskeard.

Mr. Speaker: The oral question period has expired.


Mr. Cassidy: On a point of order, Mr. Speaker, I would like to say I am dissatisfied with the answer given by the Minister of Consumer and Commercial Relations to my question on rent review, and wish to raise it at adjournment next Tuesday.

Mr. Speaker: Will you give that to me in writing, please, before 4 o’clock?


Presenting reports.

Hon. Mr. Welch tabled the annual report of the Ontario Arts Council for the year ending March 31, 1975.


Hon. Mr. McKeough: Mr. Speaker, I am tabling for the information of the members a report prepared by my staff which documents the operation of the federal anti-inflation programme in Ontario since October. Though it is still too early to make a judgement on the effectiveness of the programme, the report indicates there are some encouraging signs.

Consumer price inflation has been declining since last October. April was the fifth consecutive month in which the year-to-year increase in the Consumer Price Index was below 10 per cent. This downward trend was largely attributable to declining food prices which are not directly controlled under the programme. However, wholesale prices, a leading indicator of price trends, have shown encouraging stability in recent months. The general wholesale price index is actually below the level recorded last October. The downward trend was reflected in virtually all categories.

Turning to the wage side, the news is not as good. Wage settlements have continued to rise in the first quarter of 1976, despite AIB rollbacks. No doubt without the AIB settlements would have been higher. I hope we will now see wage settlements brought more closely into line with price and productivity trends.

Another area of concern is the potential impact of the anti-inflation programme on productivity performance and investment in our economy. This is something which we are examining with a view to perhaps recommending better productivity incentives.

The anti-inflation programme has a way to go yet before it becomes fully effective. Overall, I am encouraged by the early signs. Additional staff reviews of the programme will be tabled in the Legislature at regular intervals.


Hon. Mr. McKeough: Mr. Speaker, I am also pleased to table a report entitled “Regional Government in Perspective: A Financial Review.”

This report, prepared by the municipal finance branch of my ministry, is the summary, or if you like the culmination, of the various regional reports presented by me during my visits to each regional council last summer and fall. It compares the financial performances of the regions to those of the rest of the province and to that of Metropolitan Toronto. In doing so, I feel it adds depth to the analysis, and supplies as well a very useful measuring stick for assessing the financial problems and progress of the regions in comparison with the achievements of Ontario’s other municipal governments throughout the same period.


As the members know, the regions have been subjected to intense growth and development. With Metro Toronto fast reaching the preferred limits of its growth, the pressures on the regions, particularly those near Metro, can only intensify. For this reason, I consider it particularly important and useful to be able to gauge the region’s past performance and future prospects by means of the analysis contained in this report.

The report defines and clarifies the major criticisms levelled at the regions, such as why property taxes have undergone unusually large increases in some area municipalities where regional governments have been established. In recognizing and elaborating on the positive accomplishments of the regions, the report enumerates the difficulties which regional governments have faced in their attempts to control their spending because of the wide scope of responsibilities they have had to assume and the backlog of demand for services inherited from their predecessor municipalities.

The report also points up some important weaknesses in the performances of some regional governments, such as paying employees higher salaries for less responsibility than would be entailed in comparable jobs in other jurisdictions and maintaining costly administrative structures that could have beers reduced when certain functions were transferred to other levels of government. Even at that, it must be said that many regions have developed sound budgeting and administrative practices, and have done so with admirable speed.

I believe any fair-minded person who studies the facts in this report will be obliged to conclude that regional government represents a distinct improvement over the older system and in many respects could serve as a model for all levels of government to emulate.

Mr. S. Smith: Heaven help us if it does!

Hon. Mr. McMurtry presented the annual report of the Law Society of Upper Canada with respect to the Ontario Legal Aid Plan for the year ended March 31, 1975.

Mr. Cassidy: That’s out of date too.

Hon. Mr. McMurtry presented the annual report of the Public Trustee’s Office for the year ended March 31, 1975, and the annual report of the Law Foundation of Ontario for the year 1974.

Mr. Cassidy: Did it take a year and half to write that?

Mr. Speaker: Motions.

Introduction of bills.


Mr. Ziemba moved first reading of bill intituled, An Act to amend the Health Insurance Act, 1972.

Motion agreed to; first reading of the bill.

Mr. Ziemba: The purpose of the bill is to facilitate the obtaining of information relating to the amounts billed to OHIP by any hospital, health facility or persons providing insured services.

Mr. Speaker: Before the orders of the day, I want to announce that many of the new members in particular have requested copies of the centennial edition of “The History of the Electoral Districts in the Province.” The chief electoral officer has therefore had a copy placed in each member’s mailbox.


Hon. Mr. Welch tabled the answers to questions 31, 48, 52, 55, 64, 66, 77 and 78 standing on the notice paper.

Mr. Renwick: Since you have been the House leader you are the first one from whom we can understand the numbers.

Mr. Speaker: Orders of the day.


Hon. Mr. Welch, on behalf of Hon. Mr. Meen, moved third reading of Bill 47, An Act to amend the Ontario Guaranteed Annual Income Act, 1974.

Mr. Renwick: Mr. Speaker, in the absence of my colleague, the member for Bellwoods (Mr. McClellan), I want to reiterate, on third reading of the bill, that we consider the government has made a serious mistake in discriminating between persons within Canada -- between those born here, who are resident here and who will not be subject to restriction on their eligibility for the GAINS programme and those who were not born here and are either landed immigrants or Canadian citizens but who will be discriminated against with respect to their eligibility under the GAINS programme.

We oppose what the government is doing. We consider it is wrong. We consider, in the light of the arguments which were put to the government, that it is most unwise to proceed with this legislation.

Motion agreed to; third reading of the bill.


Mr. Spence moved second reading of Bill Pr9, An Act respecting the Kent County Roman Catholic Separate School Board.

Motion agreed to; second reading of the bill.

The following bill was given third reading upon motion:

Bill Pr9, An Act respecting the Kent County Roman Catholic Separate School Board Act.


Mr. Breithaupt, on behalf of Mr. Reed, moved second reading of Bill Pr12, An Act respecting the City of Burlington.

Motion agreed to; second reading of the bill.

The following bill was given third reading upon motion:

Bill Pr12, An Act respecting the City of Burlington.


Mr. Renwick, on behalf of Mr. Grossman, moved second reading of Bill Pr13, An Act respecting the City of Toronto.

Motion agreed to; second reading of the bill.

The following bill was given third reading upon motion:

Bill Pr13, An Act respecting the City of Toronto.


Mr. Lupusella moved second reading of Bill Pr21, An Act respecting the Dovercourt Baptist Foundation.

Motion agreed to; second reading of the bill.

The following bill was given third reading upon motion:

Bill Pr21, An Act respecting the Dovercourt Baptist Foundation.

Clerk of the House: The 18th order, House in committee of supply.


On vote 1001: (continued)

Mr. Good: I believe I was speaking when we adjourned the other night at 6 o’clock. I want to pursue a few additional matters under the general office vote -- at least the ministry office -- because I don’t know where they would fit in any other place.

Continuing with the thought I was talking about, that is the $200 million of savings on deposit in the Province of Ontario Savings Office which is credited to the consolidated revenue of the province, I still do not understand how the province can have use of these funds without any debt instrument appearing anywhere in the financial statement to relate to the borrowing that goes on by the province of these funds.

I know the Treasurer (Mr. McKeough) said it would show up in the balance sheet. All right; it would show up as the cash flow usable by the province, but on what authority do you use the money if there is no debt instrument to operate? In effect you then have an additional $200 million borrowing capacity, which doesn’t show up anywhere in the Treasurer’s report. Now, granted, the additional funds they expect do show up -- the $31 million additional funds from Ontario Savings Office -- but I would like an explanation of how the $200 million on-going on deposit shows up in the Treasurer’s report?

Mr. Chairman, we must remember that any other institution carrying on a depository function, such as a trust company, would be then guided by the principles of the registrar of loan and trust companies and would be required to keep certain securities and assets on deposit to guarantee the deposits that are made to the bank. So, maybe the Treasurer could elaborate somewhat on his answer of the other night of how this $200 million fits into the financial picture of the province?

Hon. Mr. McKeough: Mr. Chairman, I don’t know what the member means by the Treasurer’s report -- perhaps he might explain that.

Mr. Good: I am sorry, the budget report.

Hon. Mr. McKeough: It does show up in the budget. It is there in the budget. I found it for the member the other day. There is the increase.

Mr. Good: But there is also your $34 million increase you expect to utilize.

Hon. Mr. McKeough: But I would say to my friend that we also owe the Canada Pension Plan several billions of dollars, and you won’t find that figure in my budget either.

Mr. Good: Oh yes, you do, under the “consolidation of debt values” shown.

Hon. Mr. McKeough: It is not shown in here. You find it in the budget. You will find it in the balance sheet, which is the Treasurer’s report and which is filed as the annual financial report of the province once a year. The authority for using that money is found in the Agricultural Development Act, which Act established the Province of Ontario Savings Office; which Act is administered by the Minister of Revenue (Mr. Meen).

Mr. Good: All right. Thank you, Mr. Chairman. I have two other matters.

Hon. Mr. McKeough: If the member wants specifics, I would refer him to the financial report of the province dated March 31, 1975, page 11. Demand deposits of the Province of Ontario Savings Office were $233 million as of that date.

Mr. Good: Okay, fine.

Hon. Mr. McKeough: This is where the information is found. In the same way, there were liabilities to debentures as of that date of $9536 billion -- and then there would be a breakdown under the note as to how that liability is made up.

Mr. Good: Fine, thank you; I will check that out.

There are two other matters, Mr. Chairman. First of all, there is the matter I brought up with the Minister of Housing (Mr. Rhodes) today in that there appears to be no authority in legislation for municipalities to charge the fee which they are now charging for zone change applications and for development applications for a development agreement. The Minister of Housing suggested this matter should perhaps be discussed with the Treasurer -- and the whole question of authority for municipalities to make certain charges.

I think the Treasurer certainly must realize that all municipalities are charging a $100 fee for zone changes and for development applications.

Hon. Mr. McKeough: With respect, Mr. Chairman, I think this is something specific, which I can’t answer at the moment -- which is another reason to make it specific. Therefore, it should probably come up under -- my guess would be the sixth vote.

Mr. Good: All right; maybe the other matter can also be brought up later. But I wish the Treasurer would clarify to the public utilities commissions of Ontario the matter that was dealt with under Bill 41, coupling with that the problem which exists in the municipality of Thunder Bay and, once and for all, bring to an end the flood of letters which all members in this Legislature are getting, which seem to indicate erroneously, in my view, that the municipalities are trying to take over the capital assets and the assets of the public utilities commissions.


I think the whole thing would be well served if the Treasurer were to make a public statement in this regard. There are those of us who are still getting inquiries and letters, which I think are not well founded, from our local utility commissions which are in fear of having their assets taken over by the municipalities. I understand this all stems from the OMEA’s directive which went out because of Bill 41 and also because of the hassle which is going on in Thunder Bay at the present time.

Hon. Mr. McKeough: I think that might wait until vote 1006 too.

Ms. Bryden: I just have one additional question. The other day the minister mentioned aircraft rental among the items under ministry office. I think he said $12,000. Could he tell us what that was for?

Hon. Mr. McKeough: What it is to be for? It isn’t spent yet. It was an estimate of the amount of air travel which I and the minister’s office -- I guess the deputy minister would be included in that -- will be making during the course of this year. I don’t know where to and when. I suppose that’s a long-term average figure of what it is; an experience factor, we call that. I flew back from Belleville today to be here, so part of the $12,000 is gone.

Ms. Bryden: Do I understand this is rental of charter aircraft?

Hon. Mr. McKeough: It could be, but it is probably government aircraft which is charged back to each ministry through Natural Resources. Occasionally they don’t have aircraft but I can only recall, I think, twice in the last fiscal year when we would have chartered a plane. Normally we’re using Natural Resources planes. The only reason we wouldn’t use them is if they weren’t available and we still needed a plane. They rent them for us, as a matter of fact, so we get a bill from Natural Resources in any case.

Ms. Bryden: Do I take it therefore that this use of government planes is for trips by ministry officials or the minister himself? Are there commercial facilities available for these trips?

Hon. Mr. McKeough: Oh, yes, sure.

Ms. Bryden: Is it cheaper to use government planes? Why do you use government planes instead of ordinary commercial aircraft or trains?

Hon. Mr. McKeough: If the plane is full, depending on the distance, quite often it is cheaper or it is comparable. The main difference is usually the availability and the time schedule. Speaking in Belleville today at noon was a good example. I don’t know of any other conceivable way that I could have been discharging my responsibilities here at 2:50 without the use of a government plane.

Mr. Shore: The other day when we began these estimates, the question originated as to whether there was any additional spending by the Management Board or otherwise that wasn’t revealed in the estimates. The Treasurer proceeded to answer the question, stressing that it wasn’t a question of not revealing. Maybe my terminology is questionable. At any rate, he then went on to explain some of the Management Board decisions. Then we got into the subject of approximately $171 million which is in the budget called “contingency for salary awards.” The minister is quoted as trying to explain that. I sort of thought I was understanding it. One part of his quotation is:

“Finally, there was quite a deliberate move, which is as good a point as any to fess up to -- I don’t know that I have got the details of it here and I don’t know whether the Chairman of the Management Board touched on this -- since there is no provision in the Financial Administration Act.”

He then went on to discuss it. I thought I was receiving an explanation but I must say, having read it, I am not satisfied that I really understand the explanation. To me it is a very important item and a very important issue and I would like very much to have this whole area explained to me because it really is significant.

I will feel totally uncomfortable until I’ve got a satisfactory answer so that I can clearly understand it -- never mind question it, but truly understand it. There are conflicting statements and I am sure the Treasurer may understand it that way but, with the greatest respect and in fairness to myself and to others who may be interested -- maybe even in fairness to the Treasurer, if he is interested; I don’t know -- certainly in fairness to myself, to understand what happened here requires further explanation.

Admittedly the Treasurer may say this is a Management Board item and unfortunately the Management Board estimates are already dealt with. I would hope we will not get rid of that problem or the answer to the question with that type of statement. I would respectfully ask if the Treasurer cannot explain it more fully here that he direct somebody to explain it to me and to any others who may be interested. I conclude that I can’t even question it until I can clearly understand it. There is something there which is just not coming home to me.

Hon. Mr. McKeough: Mr. Chairman, this is found in vote 501, item 4, under Management Board, the $171 million salaries and benefits contingency. What I made reference to the other day was $43 million of that amount and two of the four items do affect these estimates.

The difference between $43 million and $171 million is $128 million, which is the amount which is in the Management Board estimates for pay increases -- possible pay increases -- from April 1, 1976, to March 30, 1977. Included in the $171 million is a further $43 million which is an estimated amount which, if, as and when arbitrations are ever handed down and settled, would be applicable to the period -- the earliest period, I guess, would be, for some of it, Oct. 1, 1975 to March 30, 1976; and some of it from Jan. 1, 1976, to March 30, 1976.

There is no provision in the Financial Administration Act for this. I would think the next time we amend that Act we would make a provision or make allowance for a provision to set up that amount which we legitimately feel is owing, $43 million. It will undoubtedly be that amount, more or less; that is what we estimate it may be. As a matter of fact, I guess part of it was settled after the estimates were printed but before yes, after the estimates were printed, a small part of it, for the non-bargaining group, but forget that interjection really.

To reflect accurately in the budget of the province the fact that, as of March 30, we had a salary and wage contingency of some $43 million, the decision was made to make one advance payment to four items in all, which normally would have been spent really on April 1, 1976. In effect, we paid them on March 30, 1976, and reduced the estimates you have in front of you by that $43 million.

By journal entry, really, that, I guess, has already been reversed on April 1 -- or it will be. We have paid in advance, to give you the accurate figures, to the Educational Capital Aid Corp., $5.9 million; to the Land Corp., $22 million; to the Northland Transportation Commission, $11 million; and for hospital construction loans, $4.1 million. That should total $43 million. We paid that out on March 30, which, in effect, increased our expenditures last year by $43 million, reflecting that liability, for wages, and we reduced this year’s estimates in those four categories by $43 million, reflecting the fact that when we pay out that $43 million it will, in fact, be a 1975-1976 expenditure, rather than 1976-1977.

Mr. Shore: Bear with me, Mr. Chairman. I must say that I cannot grasp it, because I am having difficulty understanding. The mathematics I can accept, the bookkeeping and accounting I can accept, but I am having trouble relating it to the statutory requirements in the Financial Administration Act.

I am not clear, personally. As I understand it these is nothing in provincial law that allows a government to accrue. Is that correct? Could I have that answered for me? In other words, when your budgets are done and when your expenditures are over with, the moneys must be disbursed in that year. Is that correct, because that is where I am really having trouble here?

Hon. Mr. McKeough: We are on a modified cash accounting basis. Essentially what you are saying is correct. There are a couple of variations. We keep the books open until, I think this year it was April 23; in effect, I am not sure whether the cheques would go out on April 23 or backdated to March 30; that’s what I would call that kind of cash accounting. That is essentially what happens. We do accrue, in my language, instead of setting up an accounts payable, but I don’t know how much that was. We, in effect, under the Act, pay those bills all as of March 30. They are all for goods and services received during March, but the bills weren’t necessarily available at March 30, or the approval hadn’t been given to pay them until April 23, and then we close the books.

What the previous amount boils down to is that we ended up the year with cash requirements of $1.889 billion. Had we not made the entries for the $43 million, we would have ended up the year with cash requirements of $1.932 billion. We are budgeting for cash requirements of $ 1.230 billion, and had we not done what we did, the cash requirements would have been $1.276 billion. In other words, in effect, we made provision to pay certain salary and benefits in last year, even though they weren’t paid, due to delay in settlement. We will be paying these this year, but they don’t reflect in the books for 1975-1976.

I couldn’t agree more that it is a rather cumbersome method of doing things. On the other hand, the member who sits practically behind you was quite sure that we were going to have cash requirements of over $2 billion. I recall the former Leader of the Opposition (Mr. Nixon) talking about $2.1 billion, $2.2 billion and $2.3 billion, and I wanted to do my best to come as close to those figures as I could, and that’s what attracted me to making this move on the $43 million. I didn’t want to see him as far out on a limb as he was.

Mr. Shore: Unfortunately, it still isn’t clear, but I accept what has been said so far. I wish I could understand it a little bit better. I will after digesting it, unfortunately.

Could I now get an explanation of this: Of the $171 million, $40-odd million is accounted for by how you have explained it here now; but where is the $120-some million? Is that relating principally to potential salary adjustments? Is that correct?

Hon. Mr. McKeough: It is very much part of it. I assume you debated it under vote 501, in Management Board; item 4, as I recall.

Mr. Shore: I am sorry, I wasn’t here for Management Board debate.

Hon. Mr. McKeough: Those funds have actually been at vote.


Mr. Shore: Do the expenditures relate substantially to the 1975 fiscal period?

Hon. Mr. McKeough: The $43 million was; the rest of it wasn’t. The $128 million all applies to this year, the year beginning April 1. The $43 million applies to the year ended March 31.

Mr. Shore: I see. The money is for contracts that are in process of negotiation --

Hon. Mr. McKeough: Arbitration.

Mr. Shore: -- but does not relate to anything prior to April 1, 1976. Is that correct?

Hon. Mr. McKeough: Yes, $43 million of it.

Mr. Shore: Now, I appreciate the point that you make, but the $128 million --

Hon. Mr. McKeough: That’s all for the coming year.

Mr. Shore: -- is in anticipation of what you might have to pay under terms that haven’t been settled yet. Otherwise, they would have been allocated to the right --

Hon. Mr. McKeough: Yes, that’s right. You see, other years these things have been settled before the end of the fiscal year; I’m sure the Chairman of Management Board (Mr. Auld) said this --

Mr. Shore: I am sorry, but I wasn’t here.

Hon. Mr. McKeough: -- or most of them have been settled. This year, because the whole shooting match, 55,000 people, are in arbitration, it wasn’t settled; and I think it would have been very wrong to bring estimates before the House which were under by some $100 million.

Mr. Shore: As long as I clearly understand --

Mr. Chairman: Obviously the sums of money that the hon. member for London North is talking about aren’t appropriately before this committee. They were discussed in the Management Board estimates, and if the hon. member wants further clarification, I suggest that he chat with the Chairman of Management Board about it.

Mr. Shore: Excuse me, Mr. Chairman. If I may have your indulgence for a minute, I have been advised by those from this side who were here that apparently this subject never came up. If you could just let me have one more moment, all I really want is to be totally satisfied at this point that the $128 million is totally for estimated --

Mr. Chairman: Surely it is not a question of whether it came up; it should have appropriately been brought up under the Management Board estimates.

Mr. Shore: I don’t want to debate it, but if you will give me the privilege and the courtesy of getting that one question answered, I will be satisfied; rather that than debating whether it should or shouldn’t have come up, Mr. Chairman. You know, if you want to play the game about what’s technically right or wrong, I apologize for not having got the information; but I am now asking for that information.

Mr. Chairman: Obviously, you have got to get it from the Chairman of Management Board and his estimates aren’t before this committee. They have been passed by this committee.

Mr. Shore: I think somebody over there is prepared to answer my question. Are you going to rule that no one can answer me?

Mr. Chairman: You had an opportunity when those estimates were before the committee, and obviously you didn’t take advantage of that opportunity.

Mr. Shore: I appreciate that. I wasn’t on that committee, but are you going to rule -- somebody apparently is prepared to answer, Mr. Chairman.

Mr. Chairman: It is a committee of the whole House --

Mr. Shore: It is a disappointment, Mr. Chairman, when there’s so much time wasted here, that I could get an answer in a matter of 30 seconds. Really, it’s a disappointment if you have to rule that way. I thought this was a more democratic --

Mr. Chairman: We would have to revert to the Management Board estimates in order for you to ask that question.

Mr. Shore: I simply asked the question; surely somebody over there is capable of answering it. I will abide by your ruling, but it really is a disappointment if you rule that way.

Mr. Chairman: It may be a disappointment, but the Chairman of Management Board has indicated he might be able to clarify the situation.

Hon. Mr. Auld: Mr. Chairman, if the hon. member would look at page 1796 of Hansard for April 29, in the second paragraph and further along, I explained as best I could the somewhat complicated situation. If he would read those two bits, they explain the $171 million. If he still isn’t clear, I will be glad to talk to him outside the House. I said it was terribly complicated and that it was the first time we were doing it. I tried to explain it because it can deal with two contract years and three calendar years. They are estimates based on what might come out of the arbitration.

Mr. Sargent: Mr. Chairman, with the greatest respect to the Chair, I am not too often in my place here, but the fact is I don’t think, in view of the mess this government is in, that the Chair should seek to keep members of the opposition from gaining all the information they can get.

Mr. Bain: You are keeping the government there; don’t blame the chairman!

Mr. Sargent: Whether or not a vote has been passed, information should be forthcoming from the Treasury, or any ministry, to members of the opposition.

Mr. Chairman: I want to make it quite clear to all members of this committee that there is ample opportunity to discuss any item when it is before the committee. It is inappropriate for any member, who has absented himself from the committee of supply, to come back in and say, “I wasn’t here when this estimate was properly before the committee, so I want to waste the time of this committee doing it now.” It is inappropriate, and if you want to challenge my ruling you are quite free to do so. The actual question that the hon. member for London North asked isn’t being voted in these estimates.

Mr. Shore: On a point of order, Mr. Chairman, I don’t want to challenge it at all. I made a positive constructive suggestion, and I must say that all I was doing is responding to something that was discussed in TEIGA estimates the other day. The Treasurer did respond to that. All I was trying to do here was to clarify it in my mind. I have no apologies for that and I respect your ruling.

Mr. Sargent: Mr. Chairman, across the free world, in many administrations it is the practice and not the exception now, in view of the mess that governments are in in most every sector, that they resort to an outside audit of their affairs. You have, in this vote, an amount of $139,000 for internal audit.

Today I was told by a top official in government in this province -- he’s in charge of the affairs of 300,000-and-some people -- that there had been a payoff of $9 million to a top Tory for land acquisition for the parkway belt west. This is not in this vote, but I am trying to say it took me a good two hours to get to the right person to find if this was true or not, and I still didn’t find out, and here I am, about six hours later, and still I don’t know. I asked a question in the House and no one laughed or laughed it off. The point is that we judge the position of everything from department to department.

It is most important -- when we are talking to this first vote, on policy -- that somewhere along the line the people of Ontario have to know that we are getting a square deal for our money, and I submit that we are not. When a member of this House sits here and can’t get a simple answer after six hours, then how in the hell can the taxpayer in Grey-Bruce, or Ottawa, or Windsor, find out what is going on?

So I say to the minister most respectfully, in answer to your point, yes or no, why will you not allow an outside audit of the affairs of this province? Why not have an outside body find out just what is going on? Why are we in such a financial mess here, and what have you to hide? Let’s have a look at it. Why can’t we do that?

Hon. Mr. McKeough: Mr. Chairman, these are questions which might well be debated in the estimates of the Provincial Auditor, which are going on or will go on in another place. The fact is that everything we do is audited by the Provincial Auditor. I think you will find the internal audit in the estimates of all ministries. It is the staff who are assigned the specific responsibility of making sure that the expenditure of money does, in fact, conform with the amounts voted by the Legislature from time to time for specific purposes.

I have never heard any suggestion, frankly, that the province should replace the Provincial Auditor -- who is a servant of this House and who answers to the House in his own estimates and who answers to the House regularly through the public accounts committee -- with an outside auditor. I have not heard that suggestion before.

Mr. Sargent: Mr. Chairman, I have the greatest respect for the Provincial Auditor. I’m not suggesting that he has anything to do with anything that is irregular. But in view of the fact that other administrations are doing this -- they find it fair to the public -- why will you not resort to that?

Hon. Mr. McKeough: I’m not aware, Mr. Chairman, of any other jurisdictions which are not using a similar system.

Mr. Sargent: There are more than a score of American states who have outside audits of their affairs.

Hon. Mr. McKeough: It is not part of the Canadian tradition, and I doubt very much if this House would approve some sort of legislation --

Mr. Sargent: The opposition would approve, I’ll tell you that.

Hon. Mr. McKeough: Oh, I see.

Mr. Sargent: I think I can say that -- on behalf of eight million taxpayers who are taxed to the limit right now. Two years ago -- and we’re talking about the chief money man in this province, who sets the tune for what we have to pay -- we had your budget come down and you put $1.5 billion in that for land acquisition for a parkway belt. You put $1 billion in it for Escarpment land acquisition. Today, when I ask, your top officials have never heard of that figure, but it was in your estimates two years ago. Now, if we’re talking big numbers, who knows about these things?

Hon. Mr. McKeough: There is no money in these estimates, Mr. Chairman, for land acquisition for either the Escarpment or the parkway. They were in the estimates of the Ministers of Natural Resources and Government Services.

Mr. Sargent: Okay. I was advised this morning to work through TEIGA. I’ve talked to your man, Mr. Don Taylor, and after a lot of manipulation I found I should be talking to Government Services. They were acquiring land for the parkway belt.

Mr. Chairman: May we remind the hon. member we are dealing with vote 1001, ministry administration programme. The amount to be voted is 4.244 million. Now, if you want to talk about general policy, having to do with the ministry office, that’s quite appropriate --

Mr. Sargent: That’s what we’re here for.

Mr. Chairman: -- but you can’t talk about the parkway.

Mr. Sargent: All right; we’ll talk about policy.

Insofar as amounts of money have been budgeted for a certain ministry, I suggest to you this minister is the man you should talk to. He is the Treasurer of the Province of Ontario. If we’re talking policy, as I mentioned to him the other day, we are losing at the rate of $7 million a day in this province now.

I ask you, Mr. Minister, to think very seriously about this. I’ve spoken in this House for the last 15 years. And each time I have spoken -- I know you never listen to my speeches and you’re not missing very much -- I’ve asked for an outside audit, to let the people of this province know exactly what you are doing, and you want to keep it among yourselves.

It is amazing to me that in the Province of Quebec the RCMP investigate everything that’s wrong, the hanky-panky. In the federal government, the RCMP investigate everything that’s wrong, the hanky-panky. But in the Province of Ontario, you people investigate yourselves -- such as with the Fidinam Affair and the Moog and Davis hotel over there. You investigate yourselves. You investigate yourselves every time.

This is the time and place now that we’re looking for dollars. Where are they going? We have the right not to take your word every time for it. It’s our vote. We have the democratic right to say we want an outside audit to see what the hell is going on. You say no, you don’t think the House would approve of it; we should trust our Auditor. Certainly I trust our Auditor, but I don’t trust the Conservative Party the way you’re playing this game.

Mr. Chairman, I say it is most important, in talking policy, that we have an outside auditor. I think it is time to approach the Leader of the Opposition (Mr. Lewis) and see if he’ll go along on a resolution to that effect, in spite of the Treasurer.

Ms. Bryden: Mr. Chairman, I’d like clarification as to whether the expenditures of the Civil Service Commission come under this ministry. It’s not in the index of the estimates, so we’re a bit in the dark.

Hon. Mr. McKeough: That is under the Management Board.

Ms. Bryden: Could you tell me why it isn’t in the index, so we will know next time?

Hon. Mr. McKeough: You will have to ask the Chairman of Management Board, who prepares the index himself. I have no idea.

Vote 1001 agreed to.

On vote 1002:

Mr. Chairman: Vote 1002, Ontario Economic Council.


Mr. Bullbrook: I don’t want to speak about the Ontario Economic Council; I want your guidance in connection with these estimates. I’d like to involve myself in a discussion of the application of the anti-inflation programme to the LLBO and LCBO employees. I would like to know if you feel there is any vote under the Treasurer’s estimates relative to that matter.

Hon. Mr. McKeough: There is none under my estimates pertaining to the LCBO employees. I don’t suppose there is a vote particularly in anybody’s estimates other than the main office vote of the Minister of Consumer and Commercial Relations, through whom the two boards report to the Legislature.

Mr. Bullbrook: I’m appreciative of your comments but if you would indulge me for a moment, the problem I have is that I felt the Treasurer to be the minister most appropriate for the implementation of the anti-inflation programme since he was the minister who set out the guidelines as far as the province was concerned. It’s the execution of the agreement and, therefore, the purported severability of the arbitration award from the collective bargaining agreement between the association and the government which put the present employees in this difficult situation.

Mr. Chairman: If the hon. Treasurer has any place in his estimates under which he would care to discuss them and the committee agrees, all right, but it’s certainly not appropriate to bring it up under item 1002 which is the Ontario Economic Council programme.

Mr. Bullbrook: I realize that and the reason I’m asking for your indulgence is, as you recognize, there are two committees concurrently sitting with the House and we have to be out for a time. I wanted to ask this question. I take it, then, that there is no vote under the Treasurer’s estimates that is directly applicable to the anti-inflation programme?

Mr. Chairman: He has indicated that.

Mr. Bullbrook: Thank you very much.

Hon. Mr. McKeough: Mr. Chairman, I think it is either Consumer and Commercial Relations or, perhaps, the Management Board. It really isn’t here.

Mr. Shore: Mr. Chairman, in relation to item 2, vote 1002, the Ontario Economic Council, I would be interested in knowing the judgement of the Treasurer as to how effective the Ontario Economic Council has been as far as he is concerned, to what extent his ministry is looking at its submissions and weighing them in policy decision-making, and how it relates to policy formation of the government, particularly in relation to the changing position of the Ontario Economic Council. Two years ago its actual budget was around $530,000 and for this year its budget is anticipated to be $852,000 showing at least a 60 per cent increase.

I would like to hear the Treasurer’s observations as to what the cost benefits may be, if any, in an increase in the Ontario Economic Council’s budget of up to 60 per cent? What does he perceive its change in role, if any, to be?

Hon. Mr. McKeough: Actually, it’s down this year, as the member will have noticed. I think it’s fair to say that at the time -- I wasn’t involved then. I was involved in it four years ago, I guess, to some extent, although at that point the Ontario Economic Council was in the estimates of the Ministry of Industry and Tourism and reported to the Legislature through that ministry.

Five years ago, a very distinguished Canadian, Dr. Gillies, assumed the chairmanship and came to certain conclusions as to what the council would or wouldn’t do. Before the 1972 federal election he resigned.

Mr. Breithaupt: Whatever happened to him?

Hon. Mr. McKeough: He has been proved so right in terms of wage and price controls that you, of all people, should not have asked that question. You have so much egg on your face on that issue in the Liberal Party that it’s sort of pathetic.

Mr. Shore: What’s this?

Hon. Mr. McKeough: I had hoped you wouldn’t bring that subject up because you, of all people, should understand the depth of your embarrassment on the issue.

At any rate, after that -- I wasn’t involved -- Prof. Reuber became the chairman and he laid out for the Premier and then the Treasurer a five-year plan of where they hoped to go and what they hoped to accomplish. I think implicit in that was taking budgetary positions roughly and subject to review by Management Board and subject to review by the responsible minister of the day. They felt that to do what they would like to set out to do their budget would go from about $500,000 to $1 million over that period of time. That’s the programme on which they’ve been working. I believe their request was very close to $1 million and we cut them back in our estimates process to $852,000. I don’t think that figure was altered by Management Board, as I recall, but they didn’t get all they really had hoped to get.

The assistant deputy minister points out to me that this year reflects the same constraint as others, a reduction from $889,000 actually to $852,000 which is $37,000. In fact, they were cut back last year by $52,000 to $852,000 by the supplementary actions which were taken in mid-year. They’ve been constrained along with everybody else. However, that wasn’t the member’s basic question.

The basic question was, for very close to $1 million are we getting our money’s worth? I think that’s a very difficult question to answer. Forgetting how the Ontario Economic Council was conceived and brought into being, I can only speak as to the direction which the Premier and cabinet thought it should go four or five years ago with which I fully concur. Unfortunately most of the economic research in this country, using that term broadly, tends to be done on a national basis. In fact, the independent research organizations, the Conference Board, the Howe Institute, the Institute for Research and Public Policy and Simon Fraser Institute in British Columbia are all located other than in Toronto.

That doesn’t present an insurmountable problem but it intensifies the fact that their focus is on the country, and perhaps properly so, rather than on the regions of the country and, in our case, Ontario. Three of the five chartered banks at my request a year ago in our pre-budget discussions with them attempted to be more specific in terms of forecasting and in terms of numbers generally with respect to the Province of Ontario, which was most helpful.

What I’m really saying is that the Economic Council is one check or balance to Treasury, Economics and Intergovernmental Affairs. I would not concede for one minute -- and I said this in my opening remarks -- that we have anything but the very best of staff in Treasury, particularly in the whole economic area, the forecasting area, but there really aren’t any outside agencies who are probing, if that’s the word, or testing or jabbing a bit at the wisdom, brains, intelligence and native ability of the people who work in Treasury.

The Economic Council can be, and I hope is, one such instrument. When they criticize us, I say amen and hallelujah. We do want some independent advice and some independent thinking. I think they are a capable board of directors, and executive committee broadly representative of the province, directing a certain amount of research and going over that research. They prepared last year six controversial papers and sponsored a very excellent one day seminar.

In other words, we’re developing something in Ontario which is independent from government, to our chagrin and our embarrassment at times -- and so be it -- but which is a bit of a foil to what we have in our own resources. I think that is worthwhile.

Let me go a step further. My hope would be -- I think this is Prof. Reuber’s hope and that of other members of the council -- that if they achieve a degree of professional success or acceptance, and that is very much what they are working on, it would probably be reasonable to assume they may then be in a position -- but only then -- to become truly independent and not 100 per cent dependent on funds voted by this Legislature and, in effect, approved by the government of the day. I think that is Prof. Reuber’s hope; it was Dr. Gillies’ hope.

Certainly it is my continuing hope that, given three or four years of really good work and professional expertise, they would be in a position to go public, to go to labour, to business and to the banks and say “We think it’s worthwhile having somebody being a foil to the Ontario government, checking on what it is doing. We think a higher degree of independence can be achieved if part -- perhaps all but at least part -- is funded separate and apart from the government.”

The Bureau of Municipal Research to some extent plays that role -- not to some extent. It plays that role very well in terms of the City of Toronto and Metropolitan Toronto; to some extent the province as a whole. It’s spreading out. We fund it a bit. For a long time it wouldn’t take money from either the city or Metro or us. Unfortunately, for some reason the contributions fell off or the programmes became more expansive and the bureau members decided they needed some government help. We now give them $25,000 a year which I am delighted to see paid out because there is an independent organization which, again, is a bit of a foil and a bit of a check on some of our experts in another branch completely of Treasury and in other ministries of the government.

That is the long-term goal. I am not competent, I think, to answer your question and say we are getting reports which are of a calibre or level of expertise or research and depth which warrants the expenditure of that kind of money. I think ultimately we will get that kind of professional comment from the profession out there which will give us that kind of feedback.

From what I have seen in the year I have been back in Treasury, I would have to say that despite their pot-shots at the government -- there have been several of them -- I am delighted that they are doing their thing and are being as visible about it as they are. I think those are good signs.

Mr. Shore: Mr. Chairman, I would like to make clear that as I see it that the minister is consistently talking about his restraint concept and that in this vote the estimates for 1975-1975 was $889,000 and anticipated 1976-1977 is only $852,000, therefore there is likely to be a $37,000 drop.

I think it should be understood and clearly on the record that I have had an opportunity of going through all the TEIGA estimates and you must look very clearly at the actual figures for 1974-1975 to get a real picture of what has happened over the last couple of years. Although there may be some suggestion that there are some changes this year compared to last year I must stress that until I know what the actual 1975-1976 is as opposed to the estimate, I can’t be satisfied as to whether or not there is restraint.

Even without that information, I think it should be on the record that if you look at most of these votes, you will see substantial increases between 1974-1975 and estimated 1976-1977. We must be very careful and cautious and not get carried away with this restraint concept.


Hon. Mr. McKeough: Mr. Chairman, just to answer that question, I know the member doesn’t want to believe the figures because he spends so much time looking at Ottawa figures which just go up. Ours come down, and he can’t understand that, being a Grit. The actual fact is that in 1975-1976, because of the restraints and the cutbacks proposed in this particular vote we can’t give this information for all ministries or all votes yet. But in this particular vote and item they were constrained, as was everybody else, starting in July, 1975, and they spent $852,700. Therefore, in 1976-1977 they are being allowed no growth for inflation, and in fact are being asked to eat inflation -- which, is the expression used.

Ms. Bryden: Mr. Chairman, I have grave doubts about whether we should be voting close to $1 million at this time for the Ontario Economic Council programme. It seems to me this is a case where we should be looking very closely at priorities and deciding whether it is more important to maintain this kind of research or whether we should be using the money for some of the services that have been cut back very severely, such as social security and assistance to children and homes for the aged, or whether there should be more money available for the municipalities to forestall the huge property tax increases that are coming. It seems to me this is an item that is definitely in the category of ones that should be reviewed this year and possibly considered for much more substantial reductions.

I think we all are in favour of research, as we are in favour of motherhood. The more we know about any subject, presumably the fewer mistakes we’ll make. But this kind of research, that is not related directly to government policy making, is perhaps something that should be carried on by universities and by non-profit, outside research organizations of the kind the minister was talking about. Whether we should be providing the seed money to help such organizations get going is another question. But I question whether it is a priority at the moment, particularly when I look at some of the studies that the Ontario Economic Council is planning for the next year or two, or which it is just bringing out.

They’ve just issued a leaflet of some of their studies that are about to be released. One of them is on the effects of energy price changes on commodity prices, interprovincial trade and employment. This study starts with the assumption that there will be a 100 per cent increase in energy prices. To me it is really shocking that we should accept that premise, especially in light of the profits of the oil companies.

I know we can’t do too much about what the OPEC companies will charge us but we do have our own oil and natural gas which we can develop. I don’t think a study based on that premise is really what we want at the moment.

It comes up with the conclusion, according to the brochure, that petroleum and natural gas prices should remain uniform throughout Canada. That is a principle that I think a lot of us would support. But it does not come up with any position, apparently, as to whether that price should be the world price or whether it should be a somewhat lower price which would be desirable in this country when we think of the absolutely tremendous effects of energy price increases on our whole economy, on our exports, on heating in this very cold country, on our transportation problems and so on. That is one study where I wonder whether it is really keyed into how we are going to meet the energy crisis in Canada.

Another study is dealing with tariff and science policies. It deals with the question of whether economic nationalism policies will be, in the long run, good for the economy. But it’s basically dealing with federal policy. They make the tariff policy and they make the science policy to a large extent, although I think the province could do more to assist research and development by industry and by universities. Again, I question whether this kind of study is what the Ontario government should be spending its money on at the moment.

There is another study on property crime in Canada, which perhaps indicates that the government in power here stresses property more than people. It is apparently more important to study property crime than to study the crimes of polluters who use their property to fill our rivers with waste that really destroys not only the environment but the whole economy as well.

Yet to come is a very intriguing title: A Study of “A Theory of the Expenditure Budgetary Process.” We would be very interested to know whether the Conservative government has a theory of expenditure. From observing it, as I had mentioned in my budget speech, it seems to be one of wild spending before elections and cutbacks after elections -- cutbacks affecting the people who can least afford to have their services cut back, but not cutbacks of a significant nature in things like the Ontario Economic Council; nor cutbacks in the Premier’s office, which I understand has gone down from 62 to 61 people in the last year.

I question really whether the council is asking itself the right questions and trying to answer those. In my opinion, the questions it should be looking at are, “How can we create more jobs in Ontario to overcome the growing unemployment?” Our unemployment rate went up last month in Ontario. In April, there were 249,000 people out of work, for a rate of 6.4 per cent. That is the unadjusted figure. The adjusted figure is 255,000, for a 6.5 per cent rate.

The council should be addressing itself to the development of an industrial strategy for Ontario. How can we use our resources, our lumber and our minerals to develop our economy? There was a question answered in the House the other day that showed that these contribute only 10 per cent to 15 per cent to our employment, to our shipments and to our economy.

Another question is, what we are going to do about providing housing at reasonable rates? How are we going to do this? The reports that have come out so far have stressed that it should still be left to the private sector; in fact, there seems to be a bias in the Economic Council’s report, that you generally leave things to the private sector. You might have rent supplements as a form of subsidy if the private sector can’t produce housing at an affordable price; but until you have some control over rents, you are just putting money into a bottomless pit, and until you have some plans to increase the supply of moderate priced housing, you will be supplementing very high-priced housing.

Another question that they should be addressing themselves to is not how to shuffle the welfare dollars around so that presumably the dollars go to the people most in need -- although I think that is an important point -- but how to get people off welfare. That is much more important than just shuffling the existing dollars around, because the people will be self-supporting, they will be taxpayers and so on.

A fifth area that the council has not been addressing itself to is the question of tax incidence. The Smith committee, as one of its major recommendations nine years ago, when it aid a study of tax incidence, recommended that there should be an ongoing study of tax incidence in this province; that we should know who is really paying the taxes; that we should know, when the property taxes and the OHIP premiums are increased, who is really paying the shot in those cases.

On the whole question of northern development and regional development, the Economic Council has not produced specific plans for those regions. I know it has done some regional studies but we need studies that will show how we can replace imports with production in Ontario, how we can use our resources and how we can see that those outlying regions are developed. We need a cost-benefit analysis of the industrial incentive programmes which the government has tried over the years as its answer to unemployment and to lack of development.

We’ve had all these programmes of the ODC and of accelerated depreciation and of reduction of sales tax on machinery and equipment and so on, but we have never yet had a study of how many jobs were created by each of those programmes. In fact, this is one of the areas where I am most critical of the Economic Council. They do not appear to go in for enough original research, taking a problem and actually making surveys of their own or making studies of their own. They tend to use more secondary sources. I think some of their studies are very useful compilations of the information available in the field and of the various proposals that have been made, but in the long run they are not doing the nitty-gritty of research that this government needs to guide it on how to meet these problems.

This is where I think we are lacking. If we have $852,000 to spend, it seems to me what we need is not an independent outside research body that does studies, but an economic planning council for this government which will be working to solve those problems that are most urgent and that this government has not been attacking.

Therefore, I find it would be difficult to support this particular item unless the minister can justify to us how he thinks that the $852,000 will really help him in solving the economic and social problems of Ontario.

Hon. Mr. McKeough: Mr. Chairman, I couldn’t help but think the member doesn’t think we’re getting value for our money. She started off by saying that this was something that should be reduced in time of constraint, and then proceeded to describe a programme of some six or seven items which I venture to say, if we got into all those things, would cost five or 10 times the amount which has been suggested as being appropriate in this year’s estimates.

I can’t defend the decision that you do one study and not do another study. Perhaps on another occasion these estimates might be before committee and the Economic Council members themselves could give those kinds of specific answers as to why they are looking at some things and not at others. The member said this is perhaps too much in a year of constraint, but then added, “Let’s do more original research,” and I just don’t think things can wash that way and that easily. She wants more science policy. She wants us to spend more money on research and development, and obviously she doesn’t like what they’re doing.

Make no mistake -- I make this final comment -- the member suggested it was going to turn into some sort of an economic planning council for Ontario, and that is not part of their terms of reference nor is it part of the philosophy of the government of Ontario that we’re going to have that kind of a planned economy, much as my critic would like to see one.

Mr. G. I. Miller: Mr. Chairman, could the minister inform me, as a new member of the Legislature, how the members are selected for the Economic Council, and who are they?


Hon. Mr. McKeough: The members are appointed by the Lieutenant Governor in Council. The latest list contains the date of their original appointment, and of course a number of these have been reappointed from time to time, but there is a turnover. I believe the three new members appointed this year are all brand new.

Going back, Mr. David Archer, who is known to some in the Legislature, was appointed in 1962 -- I guess this membership is as of March 31 -- as well as Mr. R. G. Hill, vice-president of the International Union of Operating Engineers. Mr. Douglas Gibson, an economist, was appointed in 1963, and describes himself as a financial and economic consultant. He was, in fact, with the Bank of Canada or the Economic Council, is chairman of Consumers’ Gas among other things at the moment, and director of a number of corporations. He is an economist with a background I think in the federal civil service, but I am not sure of that Mr. G. L. Reuber, the chairman, was appointed in 1973. He is a vice-president, academic, I think, at the University of Western Ontario.

Mr. Shore: Yes, he is vice-president.

Hon. Mr. McKeough: In 1973 a list of people were appointed. They include, Mr. Bates, executive director of the Canadian Council on Social Development; Dr. Elizabeth Gullett, associate professor and acting chairman of the Department of Consumer Studies at the University of Guelph; Mr. H. C. Hatch, chairman, I think, Hiram Walker, Gooderham and Worts; Mr. E. L. Hollingsworth, well known to members from northern Ontario, and vice-president Sault Mill and Lumber Co. Ltd.; Mr. Lorne Lodge, president and chief executive officer of IBM; Mr. W. F. McCormick, Cambridge, president of Glen Highland Holdings Ltd.; Miss J. C. McKibbon, administrative officer with the London Life Insurance Co.; Mr. J. T. Pennachetti, chairman of General Concrete of Canada Ltd.; Dean A. E. Safarian, University of Toronto; Mr. W. C. Wilder, now with Canadian Arctic Gas; Mr. Lynn Williams, director of district 6 of the United Steelworkers; Dr. D. M. Winch, chairman of the department of economics, McMaster University; and Mr. D. C. Smith, head of the department of economics, Queen’s University.

Mr. A. Stewart, appointed in 1975, is a farmer from Middlesex.

Members appointed in 1976 are: Mrs. Jalynn Bennett, an investment officer with Manufacturers Life; Mr. R. deCotret, of Ottawa, now president of the Conference Board in Canada, and Mr. H. F. Dougall, Thunder Bay, president of H. Fraser Dougall Co. Ltd., which is, among other things, the TV station.

That is the composition of the board. I don’t know how many, but approximately 18 or 20.

Mr. G. I. Miller: Another question then in the same regard: Do they work on a per diem basis, and are they appointed on an annual basis, or what is the length of the term of office?

Hon. Mr. McKeough: I think they’re now all appointed probably for a three-year term which can be renewed. They are not paid. They are paid any out-of-pocket expenses to and from Toronto or within Toronto but they are not paid per diem. The chairman is paid.

Mr. Makarchuk: I want to take some exception to the comments made by the minister that we would want the Economic Council to be a rigid, centralized body that would decide everything in the province. Far from it. Basically what we want is something that will provide some focus and some direction, some identification of the problems that are in the province so we don’t have these rather chaotic situations which are created because of your fiscal constraints and restraints or because of your unwise use of the tax policy in things like the health field.

You can’t say there is no chaos there, or you can’t say you haven’t got chaos in your taxation policy right now when you turn it on one time and you turn it off again. These are the kinds of situations in which, with some reasonable planning, some group, perhaps independent of the government, could come up with alternatives, to be able to identify and focus, having some direction, some co-ordination and some sense as to where we want to go and how we’re going to get there. This is what we’re really trying to get at.

At this time the council really involves itself in an almost esoteric type of research which really at times is irrelevant to what’s going on in the province. If you read particularly their housing report, I thought it really wasn’t even related to what is happening in Ontario. Those are the kinds of things we take exception to. We feel the money in those areas is needlessly wasted.

I think there is room for economic planning in this government and there is room for some direction or indication so that we don’t go from a swing one way to a swing another way and so on. It’s not healthy for the minister and it certainly is not healthy for the province and it’s not healthy for the people out there.

Mr. Shore: Would the minister explain the bulk of what the services are of approximately $400,000? What are they going to be used for? What type of services are they?

Hon. Mr. McKeough: Largely they are for annual conferences, research seminars, $28,000; printing of reports and so on, $104,000; EDP for internal projects, $21,000; and research associates, $22,000. All that totals $194,000; then totalling $207,000 are the external consulting studies in the research area.

Mr. Shore: For these external consulting services they go to wherever they think they need to for that information, is that right?

Hon. Mr. McKeough: Yes. They don’t require Management Board approval for the individual things.

Mr. Shore: What does the chairman receive for his chairman responsibilities?

Hon. Mr. McKeough: He gets $200 a day.

Mr. Shore: Is the definition of a day if the council is sitting?

Hon. Mr. McKeough: No, the council doesn’t sit that often. He is the chairman of the council. The council meets half a dozen times a year; the committees of the council meet more often than that. He is on all those and he personally directs a great deal of the research himself.

Mr. Shore: What would he have got in honorariums or whatever you call it last year?

Hon. Mr. McKeough: I don’t know what the last public accounts show but it runs in my mind that it’s something in the neighbourhood of $20,000. I don’t know what it was for last year but we’ll get that figure as soon as it is available. I would guess about 520,000, perhaps a little higher or a little lower.

Vote 1102 agreed to.

On vote 1103:

Mr. Chairman: Central statistical services programme.

Mr. Makarchuk: On this particular item I am interested to know if the ministry at this time is putting out any leaflets or booklets indicating a sort of detailed breakdown on income distribution in the Province of Ontario such as the taxes paid by various groups in the province, donations and so on. There used to be a time when that information was available in one of the booklets that was provided to the members. It was in the back portion. It was rather interesting reading. But I haven’t seen any of that kind of information being made available.

I think it could be very useful. Certainly it could be useful to the government but it’s also useful to the members trying to assess the taxation, who is carrying the tax load, and certainly in terms of shifts in income in the province. Is that information going to be made available? I presume you have it on file some place. It’s just that nobody seems to know where it is.

Hon. Mr. McKeough: There used to be a book called “The Ontario Statistical Review” and I think that is what the hon. member is referring to. It has been replaced by a two-volume book called “The Ontario Statistics 1975,” which is on sale in the book store, I am informed. I guess they didn’t table it here. If the member or his party research officers would like one we will certainly get it for them.

Mr. Makarchuk: Mr. Chairman, does this book have the income distribution factors involved in it or is it just dealing with vital statistics such as births, marriages, deaths, mortality rates and so on? Does it deal with the financial aspect? That is what interests me.

Hon. Mr. McKeough: Yes.

Mr. Makarchuk: Fine. Thank you.

Mr. Shore: If you look at these estimates in 1003, you quickly get the interpretation that there is a very major restraint programme going on. Firstly, I would like to ask the minister if he has available the actual for 1975-1976 on this item?

Hon. Mr. McKeough: Yes, $1,446,800. This, of course, contains the data processing and this is an area which was heavily constrained -- data processing generally -- last July.

Mr. Shore: First of all, looking at this quickly, if you just look at the estimates and looked at the estimates for next year, you get the reflection that there is a constraint or a restraint or a hold or whatever it is. But if you look at the actual for a moment, it is still an increase in excess of 15 per cent from the year before; number one.

But I think it is more significant that just three years ago this section actually spent $773,000. To budget $1,600,000 for this year is really getting a more obvious overall picture of what is taking place. I can’t overstress that when we look at these things we have to take this type of thing into consideration.

Having said that, if you look at it in relation to just last year, you will note that most of the items in this programme for salaries, supplies and equipment have, to a certain extent, been reduced. The question that comes to mind is to what extent, if any, and how, have these economies purportedly been achieved? At what expense have they been achieved? If at no expense, then we must challenge or question what’s been taking place over the last couple of years.

I would like to see again what the minister has to observe in relation to the trade-off of constraint and restraint as opposed to services rendered and how he would respond to that.

Hon. Mr. McKeough: The explanation of the decreases between the two sets of estimates would be a complement reduction arising out of the second one, arising out of the mini-budget constraints, each of those items -- $52,000, the restraint on recruitment applying to both bases; a vacancy allowance taken out of $22,300; and the mini-budget constraints and so on $12,700, for a difference between the two sets of estimates of $139,000.


Mr. Shore: I haven’t had the other part of the question answered. What effect are these restraints, if any? I am questioning the restraints a little bit. To what extent have they affected the services rendered by this department or this programme in relation to TEIGA, or in relation to the other ministries which this section serves?

Hon. Mr. McKeough: I think we will not be able to be turning out as many reports in this area. We have traditionally turned out a number of them, not on a charge-back basis. We are now saying that if they want this information, we are going to have to charge other ministries or the public for it. It is not a bad exercise in itself because in my view, without mentioning a couple of reports turned out, I questioned the value of them. We are going to find that out. If other ministries don’t want them, or aren’t prepared to pay for them, then the reports won’t be turned out.

Ms. Bryden: When I was making my reply in the budget debate, the Treasurer may recall that I asked him if he could make available to us and to the public generally, the figures on which he based his estimates of property tax payments in the Toronto area and in the province; figures which would show the correlation between family income and property tax payments and property tax credits.

He came up with a figure, in one of his presentations on the restraint programme, that a family with a $10,000 income in Toronto was paying only $370 in property taxes last year. I find this hard to understand.

It is very difficult for us to access this kind of figure without seeing the actual breakdown of property taxes paid according to family income for each municipality, and for the province as a whole, and also property tax credits granted according to family incomes. Otherwise, it is almost impossible to really judge the true incidence of the property tax. I just wonder if the statistical services are prepared to publish that kind of information, and are they even collecting it?

Hon. Mr. McKeough: It would not come here. It would be coming from, I guess, either economic analysis or, perhaps more likely, taxation and fiscal policy. They might farm it out, or be getting information from here, but they would be pulling it together. I remember that request, and I will check and see where it is.

I would suspect that what they may be doing is preparing it in some way for the member, or trying to pull it together in a letter or something for me as a reply. I think it would be much better if the member would, and I am sure she could, and would like to, go over and sit down with them and see how they do arrive at the figures, rather than trying to put all this on paper.

Ms. Bryden: Mr. Chairman, I would hope the minister would consider it part of the statistical services to ultimately publish this kind of information for the province as a whole, and for each municipality -- whether or not this is partly the Minister of Revenue’s (Mr. Meen) responsibility. But I would like to see this kind of information made available. We cannot understand distribution of income in this province without these kinds of statistics.

Just one other question, Mr. Chairman: Could the minister tell us what the $282,000 is for services under this vote?

Hon. Mr. McKeough: It is mainly EDP $143,000; printing of the publications, $36,000; temporary help, $25,000. Most of it is computer time.

Ms. Bryden: Is this computer time from the Ministry of Government Services or is it from an outside computer firm?

Hon. Mr. McKeough: Almost all from the Ministry of Government Services.

Ms. Bryden: Thank you, Mr. Chairman.

Mr. Ferris: On the recoveries that you are contracting out I assume that there are reports being made by you. How do we bill those recoveries or how do we arrive at those? Do they include time of your staff in preparation? The recoveries are shown on the bottom, in the classification of $10,000.

Hon. Mr. McKeough: Recoveries from other ministries -- for statistical reports which would have been prepared, for which other ministries pay us -- special runs of census data -- something like that.

Mr. Chairman: Shall this vote carry?

Vote 1003 agreed to.

Mr. Chairman: Vote 1004, economic policy and intergovernmental affairs programmes.

On vote 1004:

Mr. Makarchuk: Mr. Chairman, I wonder if the minister could indicate if part of the responsibilities under this vote is the examination of the Syncrude project -- whether you were involved in examining the relationship that existed between this province and Alberta, as well as going into some financial aspects of the whole Syncrude agreement. Does this come under this policy or is that handled by the Ministry of Energy?

Hon. Mr. McKeough: Certainly we provided advice, but the questions should be put to the Ministry of Energy through the Ontario Energy Corp.

Mr. Makarchuk: When the initial decision was made to go ahead with Syncrude, was that made here or was it made by the Energy Ministry?

Hon. Mr. McKeough: It was made by the government.

Mr. Makarchuk: I have a feeling, Mr. Chairman, that this probably could be a good place to discuss it. There is a growing amount of evidence --

Hon. Mr. McKeough: With respect, Mr. Chairman, it is a voted estimate of the Minister of Energy; it is not an estimate of the Ministry of Treasury, Economics and Intergovernmental Affairs. I don’t want to nitpick but that is where it should be discussed.

Mr. Makarchuk: My reason for raising it here is that obviously there would have been some coordination of discussion between various governments -- between this government, the federal government, probably the Alberta government and so on. There was a discussion involved but it was not under this department?

Hon. Mr. McKeough: That’s right.

Mr. Makarchuk: Thank you.

Mr. Shore: Mr. Chairman, on this item -- first of all, a general statement. I would like to know if I could find out the general process that the ministry goes through in arriving at policy decisions. Specifically, when they decided to increase the tax on cigarettes, for example, and not on other tobacco items, could they give me a comment on how they arrived at that type of decision? And any of the other policy decisions the ministry makes -- what is the process they use to arrive at that?

Hon. Mr. McKeough: Next vote, 1005, item 2, fiscal policy.

Mr. Shore: Oh is it? Not on this one?

Hon. Mr. McKeough: Not on this one.

Mr. Shore: All right. You will try to remember that question?

Hon. Mr. McKeough: Yes, I am sure you will remind me.

Mr. Shore: Right. On economic policy then, could the minister tell me how many people are on staff in this section and the makeup of this staff? Are these people accountants? Economists? Lawyers? I don’t know who else you would have in here. Could I have a breakdown of the makeup of that staff?

Hon. Mr. McKeough: There are 34 in policy planning. For most economics would be the discipline. There are 17 in economic analysis and I think those who are professional -- obviously there are secretaries involved in this -- the professionals are all or mostly economists. That’s economic policies.

Mr. Shore: Is that the setup there? There are around 50 people there; is that what you said?

Hon. Mr. McKeough: Yes, that is what it totals.

Mr. Shore: Right. That would total $1,168,000; is that correct?

Hon. Mr. McKeough: We’ve got it broken down a little differently. Let’s do it this way -- forgetting the assistant deputy minister --

Mr. Shore: It’s $1,168,000 in salaries?

Hon. Mr. McKeough: Yes, $1,168,900 in salaries and wages for 50 people.

Mr. Shore: Thank you. I would like to relate this again to a two- or three-year period so we don’t get carried away with this concept of what I consider to be partially unfair comparisons as we see them in the estimates book. Could I ask the minister, through you, Mr. Chairman, if he has, for example, the actual cost for 1975-1976 for this programme?

Hon. Mr. McKeough: I am getting it.

Mr. Shore: While he is getting that could I observe that in this policy and intergovernmental affairs programme it would be interesting to note that in the 1973 fiscal year -- three years ago -- the actual spent in this programme was $1,500,000. It jumped to an actual of $2,800,000 in 1974-1975 from $2,160,000 in 1973-1974 and it is now estimated at $3,574,000. You can see well over a two times jump in little over a three-year period.

Hon. Mr. McKeough: Yes. The variable in this, that third item -- if we are now on the third item -- varies with the amount of the transfers which are listed on page G89. Those amounts do change from time to time and under the office of economic policy as well. The Institute for Research on Public Policy, for example, was a new item two years ago and a very large amount.

Mr. Shore: Yes. Thanks. Have you got the other information yet?

Hon. Mr. McKeough: On the intergovernmental affairs end of it, the biggest change is the $215,000 which is in the estimates, I guess for the first time this year, for the intergovernmental conference secretariat. It has always been there but we are starting to pay our share of it this year.

Mr. Shore: That is that $207,000 figure?

Hon. Mr. McKeough: That’s right, yes.

Mr. Shore: But it was on last year, too, I see.

Hon. Mr. McKeough: It was on last year but we didn’t pay anything.

Mr. Shore: That’s why the actual --

Hon. Mr. McKeough: Agreement wasn’t arrived at among the provinces or at least there was still -- the actual amount spent for the office of economic policy was not the $2,035,000; it was $1,472,000. There were several items of constraint there which would apply -- the freeze on hiring; the elimination of Ontario Economic Review; no payments to the secretariat; and no payments, I guess, actually last year to the Institute for Research on Public Policy.


Mr. Shore: Thank you. You were suggesting there was constraint. I guess part of the constraint last year was that you didn’t have to pay $207,000.

In relation to restraint for this year, if the actual last year was $1,472,000 and $2,234,000 estimated is for this year, I don’t see any major constraint. Now, before you jump on me, I recognize that part of it is due to the fact that you’re probably going to have to pay the $200,000-plus; I respect that, but could we have some clarification on these three items: The Conference Board in Canada, $100,000; Institute for Research on Public Policy, $500,000; and the Canadian Arctic Resources Committee, $25,000. I notice that they’re in here at $625,000 this year, while they were in last year’s estimates for a total of $307,000, I believe. There’s that variance of approximately $300,000 plus, but there’s still a very substantial increase over last year in that one section of this programme.

Perhaps the minister could enlighten me on that, and more particularly on the purposes and the commitments in relation to those three transfer payments.

Hon. Mr. McKeough: Which three?

Mr. Shore: I’m sorry. The Conference Board in Canada, the Institute for Research on Public Policy, and the Canadian Arctic Resources Committee. What do they do for us and what is our commitment there?

Hon. Mr. McKeough: The Conference Board in Canada is certainly the best known of the three. We made to them, I understand, a five-year commitment, but it is reviewable each year. The Conference Board in Canada is modelled after the Conference Board in the United States. What else can I tell you about them? They produce independent economic forecasts. As opposed to the Howe Institute, for example, they’re much more concerned with numbers in forecasting, as opposed to opinions. I think that’s a fair statement. They have a series of conferences, which are held several times a year; we receive membership in return for our contribution, staff attend, and we retrieve data from them. Again, they’re somebody I’ve relied on for two years now in pre-budget discussions for their opinion.

Mr. Shore: Could I just interject here? Is this a type of organization in which all provinces are participating, along with the federal government, in funding?

Hon. Mr. McKeough: I don’t know whether other provinces participate in the Conference Board or not. I would be surprised if they didn’t. Some do, but not all, I’m told. Memberships are distributed around the ministries, and one complete service is made available to each of the opposition parties. How we ever approved that is beyond me.

An hon. member: What’s it in there for, then?

Hon. Mr. McKeough: That’s not for the record.

Mr. Shore: We will give ours up.

Mr. Breithaupt: Very kind of you.

Hon. Mr. McKeough: You also wanted to know about the $25,000 for the Canadian Arctic Resources Committee. The committee, or CARC, was formed by a number of concerned Canadians -- Dr. Chant played a role, Dr. Deutsch was involved, and others -- who particularly concerned themselves early in the game as to the effects of development in the north; not just pipelines, but highways and a number of other things. They were concerned that the government of Canada, in particular, was not taking the necessary steps to protect the northern environment or to minimize the effects on both the natural and the human environment. They have concerned themselves somewhat with the native claims question, have sponsored a number of conferences, have produced a number of papers and intervened very early and, I think it’s fair to say, very forcibly in the Berger hearings.

This is one in which I took an interest myself, as a matter of fact, when I was Minister of Energy, and I think I was successful at that time in convincing Treasury that they should pay for it.

Mr. Haggerty: You haven’t got the runaround?

Hon. Mr. McKeough: Our interest is that we obviously have something to learn about the northern environment as it pertains to our own province. We have something to learn about native rights, land rights, and we certainly had a very large interest in oil and gas from the Canadian Arctic, and that was our particular interest. Now that committee, interestingly enough -- well, I am not sure how much of that is public yet, but that is a grant which may not be made this year, as it turns out. They are increasingly of the opinion that they have done their job, that they have concerned other Canadians and they --

Mr. Haggerty: Is the report available yet?

Hon. Mr. McKeough: No, they are not preparing a report, they prepared a series of papers.

Mr. Haggerty: Are the papers available?

Hon. Mr. McKeough: Sure, they come out every month, or every couple of months; very excellent reports. What they have mainly done, of course, is involve themselves in the regulatory process, both before the NEB and before the Berger hearing. That is something which may not be done this year.

Now, what can I tell you about the Institute for Research on Public Policy --

Mr. Shore: Tell me about $500,000.

Hon. Mr. McKeough: -- which was a dream of the Prime Minister of Canada, it is fair to say. Mr. Ronald Ritchie was the first director. He left for other fields and has been succeeded by a Mr. Carruthers, who is well known to the members from London. He had formerly been on the faculty of that university, and then went to the University of Calgary as president.

Mr. Shore: Is that the law school dean?

Hon. Mr. McKeough: Yes, formerly. He was with the government of Canada and on the founding board, now chaired by former Senator John Aird, who would be better known to members in that corner of the House than members in that corner or this corner of the House.

Mr. Shore: I don’t know him, though.

Mr. Good: Never heard of him.

Hon. Mr. McKeough: This was to be somewhat modelled, I think it would be fair to say, on the Brookings Institute. The Prime Minister of Canada, among others, asked that the private sector put up a certain amount of money as an endowment fund, that the provinces put up a certain amount of money as an endowment fund, and that the federal government would match the sum total of the two. It was originally to have been $10 million, $10 million, $10 million; I am sorry, one-third, one-third, one-third.

The Province of Ontario agreed -- I think committed is too strong a word -- on that basis to go in for $3 million over a period of years. We have paid to date $1 million of that commitment. Other provinces have paid -- I just saw these figures in their annual report, and I don’t think we have got it in here. It came in just in the last couple of days.

Other provinces have obviously paid something less than we have paid, but about five or six of them have paid. The private sector has not come through, if I can put it that way, and that bluntly, and I suspect it is because they have not yet been sold. The federal government has done what it said it would do, and I think have put in to date about $3 million. They have matched the provinces and the private sector.

I am not sure that this grant will be made this year. It is something which is presently under review, and I leave it at that.

Mr. Shore: You are saying you are not sure whether the province will make its $500,000 grant?

Hon. Mr. McKeough: That’s right.

Mr. Shore: Could you tell me, technically or otherwise, what is our real commitment? Do we have a legal commitment to this?

Hon. Mr. McKeough: No.

Mr. Shore: It is just if we are in the mood we pay it, and if we are not in the mood, we don’t pay it?

Hon. Mr. McKeough: That’s one way of describing it. I have suggested internally at this moment -- this has not yet been conveyed to them -- that we will not pay further amounts until the other provinces pony up their share and until the private sector ponies up its share. That is our recommendation on the matter to the Premier (Mr. Davis). I am not sure that he has written that letter yet, but I think I would be safe in assuming that that will be his position as well.

I do know it has been suggested by one of the provinces as a matter of discussion at one of the first ministers’ conferences which are coming up at some point. There is concern in other provinces as well.

Mr. Shore: Just to carry this on, it may be a good area to look at from the restraint point of view, as opposed to some other areas. Leaving the rationale as to why you may not be contributing as the fact that you want to make sure the other contributing provinces are putting their fair share into it, which I think is also a valid point, equally valid and probably more important to me would be whether you are getting any value for the service rendered. I would want to place that as a first question. Whether the other parties or partners involved are contributing their fair share certainly is important, but I would want to know whether there is any value for the service rendered first. Then if I get a no to that then I don’t care what the other provinces are doing.

Hon. Mr. McKeough: That’s a very good point and that’s the point we have made as well. In fairness, you are not going to be able to build this kind of institute overnight. They have produced really very little, I guess it’s fair to say, to date. They have a number of studies under way. It is too early to make that kind of judgment.

Ms. Bryden: I would like to ask questions on both items 2 and 3, but I’ll separate them though and deal with 1 and 2.

Mr. Chairman: Do you want to deal with 1 and 2 first; 1 and 2 combined and then 3?

Ms. Bryden: Item 2 is called office of economic policy. It seems to me that this is the item under which we should be discussing whether the government has an economic policy for dealing with that very high unemployment rate I referred to a few minutes ago -- 6.5 per cent of the labour force, 255,000 people, on the seasonally-adjusted figure. The minister may say you deal with it through fiscal policy, which is the next vote, but I think that fiscal policy has proved to be a dud in this attack on unemployment. Our rate has been going up steadily and both the federal and provincial governments have tried fiscal policies and have not succeeded in putting our people to work.

Certainly I find the rate of 8.5 per cent unemployment very unacceptable. The minister appears to accept the rate of 6.4 per cent in his budget. I would like to ask him if he does consider that rate an acceptable rate for Ontario. If not, does he have some policies in this particular office of economic policy? Are they working on developing policies to reduce this unemployment rate?

I don’t think he can deny his restraint programme is contributing to the problem. The hospital cutbacks are throwing out of work a lot of people who have very little training or experience in other fields and who will need retraining. The other restraint programmes, particularly the restraint in the social security field and in the municipal field, are causing a lot of people who are disadvantaged to have less possibility of getting into the labour market. Provincial rehabilitation programmes will suffer. Work activity programmes will be cut back, if the municipalities are partly funding them. Any municipally activated programme will suffer.

Provincial restraint even reaches to Canada Manpower efforts to overcome unemployment because Manpower purchases courses from our educational institutions. The latter are having to raise their fees, so much in fact that I understand the budgeted increase for federal training programmes is virtually eliminated by this provincial fee hike, which means there will be no additional service, in spite of the additional need caused by the budget restraint programme.


It seems to me that under this vote there must be some planning of what to do about this unemployment problem. I wonder if the minister has looked at all at the rather innovative programme which the Province of Manitoba has put into effect to meet the unemployment problem. I would just like to run very quickly through the three or four items that they are working on as their unemployment package.

In the first place, they are spending about $45 million to $50 million on direct job-creation activities. This includes a programme called PEP, which is a provincial employment programme. It’s 100 per cent provincially funded, designed to alleviate cyclical and seasonal unemployment. Its target group is those whose skill or location causes them to be the first to leave the labour force in times of reduced aggregate demand. Funds are provided to municipalities, local groups, schools, farms, co-ops and so on. The jobs are in the main construction-oriented but with a little effort being directed to the creation of entrepreneurial operations so that they can become instantly effective. The mandate of this programme is to create jobs.

Second, they have something known as ACWP, which is the Accelerated Capital Works Programme. It’s also provincially funded, although federal loans are also called on when available. Once again, the emphasis is on capital construction and immediate employment.

Then they have a programme called Special Municipal Loans and General Emergency Funds, which provides 100 per cent of labour forgiveness for winter projects run by the municipalities, and 60 per cent forgiveness for summer projects. This is a kind of disaster relief fund for municipalities with a high rate of unemployment which can produce programmes that need a fair amount of labour.

Fourth, they have the Manpower Corps, which provides projects to increase employment services in the field of counselling, placement services and family support. This gets people into the labour market and off welfare. It involves working with company personnel officers and company management in the development of programmes.

Those are four fields that might be studied for possible introduction here as means of meeting this very serious and growing unemployment problem in this province. The unemployment figure went up in the last figures, which were from April over March. It seems to me that is one thing that the office of economic policy must be spending part of its $2 million on. I would ask the Treasurer to comment.

Hon. Mr. McKeough: First of all, the member is correct that this is the area, I think, of the ministry where economic policy, on an ongoing basis, is studied and the appropriate policies are recommended or not recommended or attempted to be found. I should stress, and I hope I did this in the opening remarks, that these lines seem increasingly to be getting a little blurred. People I thought worked on economic policy sometimes seem to be involved in what I would have thought of as fiscal policy.

I think at one point, at one meeting on the last budget, there were people from three branches in the office other than from the taxation and fiscal policy branch. They used to -- none of them are here; I can say it safely -- guard the budget as though it was the holy grail and nobody else in the ministry was to know anything about what was going on in it. Those lines, I think it’s fair to say, have blurred somewhat and that’s one of the purposes of the reorganization of the ministry which I mentioned in my opening remarks, as worked out by the deputy minister and the assistant deputy ministers.

If I sound a little vague sometimes as to where things come from or go to, that’s part of the reason. It’s almost getting to be a collegial approach, which scares me somewhat. However, the beginning of the answer to your question is that if we were developing short-term employment strategy, this is probably where it would be coming from.

The simple answer to your question is that the office of economic policy, along with other parts of the ministry, recommended economic policy and policy actions, and the results of all that, tabled in the House on April 6 last, is the Ontario budget. Our decision was made at that time, and our decision has not changed since that time.

The member asked, do we accept 6.6 per cent unemployment in Ontario? I think that is putting it a little strongly. I think we have to remember that basically fiscal management and employment policy -- if I can put it in that way -- in this country rests, more than in any other place, in the hands of the government of Canada. Within our constrained fiscal position there is not much that we can do to overcome unemployment, which at 6 per cent admittedly is too high. We firmly believe, as expressed in the budget on April 6 -- and that is the economic policy of the government -- that the best way of bringing that unemployment rate down -- not overnight but over a period of time -- would be increased activity in the private sector, not government make-work projects of any sort.

Mr. Makarchuk: One point that bothers me is that if this group recommends to you the various economic policies which eventually are manifested in your budget, then obviously they should be called the election-planning committee. The budget last year was designed not in relation to any economic policy, but more as an election gimmick. I would suggest that is a mislabelling of this department and a misspending of the money.

Mr. Shore: Mr. Chairman, I just rise on --

Hon. Mr. McKeough: Let me be very clear -- we are not on a budget of a year ago. I think it is fair to say that a year ago the office of economic policy felt that the economy needed stimulation. They may have had views on the best way to stimulate the economy. The recommendations as to how that’s done if that becomes the policy, then comes in the next vote, in the fiscal policy area rather than in the economic policy area. I draw those distinctions because if you want to know who plots the election, I know that you want to be specific about it and tie it down to the exact branch.

Mr. Warner: It just coincided with the election.

Mr. Good: You said the fiscal policy.

Mr. Makarchuk: Mr. Chairman, on the same points, if you are going to have an economic group, surely the idea is that it has to have some direction -- again you have to know where you are going, and they will probably try to provide you with the means of getting there. This is what I see that this group is doing. And if you look at the various problems -- job creation, the environment, housing, the food lands, and so on -- obviously you are not coping. It is either (a) these people are not dealing with them -- which I doubt -- or (b) you don’t consider them as problems. If that is the case then Ontario is in a rather sad state.

It says here that there is a technical liaison with other governments on matters relating to economic policy. Was there any liaison between this government and the federal government at any time before the introduction of the anti-inflation measures? If so, was there any kind of direction from Ontario given to the federal government? Or was it totally on the federal government’s initiative alone that the decision was made?

Hon. Mr. McKeough: The government of Ontario would never deign to give direction to the government of Canada -- the language in which you might put it. Or they wouldn’t have the good sense to take it, I guess might be another way of putting it.

No. To my certain knowledge, at at least two first ministers’ conferences and one premiers’ conference, I think it is fair to say there was a great deal of discussion about the problems of inflation and an urging of the government of Canada to take it in hand, recognizing it was a national problem. At the last two meetings specifically -- one without the government of Canada and one with -- there were indications that there would be the fullest possible support by the provinces if the government of Canada moved -- without being specific as to how they might move.

Mr. Makarchuk: These discussions, Mr. Minister, then would be more or less policy discussions about which direction you were going to take. What I’m concerned about is whether, when the federal government was formulating the specifics of the anti-inflation policy -- these would be the more technical discussions -- were your people involved in those formulations or were they consulted? Did anybody ask them for any input into that federal initiative?

Hon. Mr. McKeough: I think “discussions” is much too strong a word -- certainly at the political level and at the staff level “discussions” is too strong a word. Requests for information perhaps.

Mr. Warner: Consultation?

Hon. Mr. McKeough: No, not even consultation. Request for information. I remember hearing about some of these things afterwards, and immediately after Oct. 14 there were some very basic questions: How are doctors paid? Who sets their fee schedule? That sort of thing -- a whole list of things. Some of that questioning undoubtedly went on beforehand at the staff level, but not at the political level.

Mr. Chairman: The hon. member for London North.

Mr. Makarchuk: Mr. Chairman, I’m not quite finished on this point.

In that case, Mr. Minister, obviously you had some information that the federal government would be moving in that direction or would be bringing in some type of anti-inflation legislation. Am I correct in assuming that? Because I don’t expect to see your technical people or economists entering into negotiations and providing information without (a) knowing why they’re providing the information and (b) feeding that discussion back to you. So can we assume that you were aware of the federal measures before the fact?

Hon. Mr. McKeough: Certainly. As my friend will remember, the whole thing was public all spring long in terms of the Turner proposals to management, to labour -- who turned it down -- among others, to the provinces. Our views were asked on the targets of the Turner proposal and then further requests for information flowed from that.

Mr. Makarchuk: That is not exactly what I’d like to know, Mr. Minister.

Hon. Mr. McKeough: If what the member is trying to imply is that this government, either politically or through its civil servants, had some say in the design of the programme which was announced by the Prime Minister of Canada on Oct. 14, the answer to that is a categorical “no.”

Mr. Makarchuk: That is what I wanted the minister to say -- either that he was involved or was not involved. If he says he wasn’t involved, I appreciate that.

Mr. Shore: Mr. Chairman, I wasn’t going to add any more to this section except for something the minister stated a few moments ago. Certainly I’m not going to defend the economic policies and fiscal policies of the government.

Mr. Laughren: I guess not.

Mr. Shore: The Treasurer has on occasion done that and he may continue if he wishes, but certainly I get sick and tired of consistently hearing about federal economic policy. We’re sitting in a Legislature here now that relates to provincial policy, and I would like to just get this clarified.


Mr. Chairman: Order, please.

Mr. Shore: If the minister is suggesting that the Province of Ontario cannot in a major way have something to do with the direction and the thrust that this province wants to go and if he’s suggesting that it’s all dependent on what the federal government does and to external circumstances -- incidentally, that’s what this budget relates to substantially -- if he means that, and I would hope the doesn’t, we don’t need all these highly paid people employed by him. We don’t need it. We can just keep drawing statistics from wherever the sources are.

But if he means what I’d like to believe he means, that we can control our destiny, then we should have these people. I’d like to hear what the minister has to say on that point.


Hon. Mr. McKeough: I think I will be realistic. There are some moves we could make, and we have made them in this budget. There are other moves which are obviously beyond our capabilities. For example, I have always questioned, as provincial Treasurer, the suggestion that we should roll in with a $25-million or $50-million provincially funded programme, as has been suggested, to fund work so that we will reduce the drawdown on the federal unemployment insurance fund. That, to me, is not a provincial role.

Mr. Haggerty: You have no responsibility?

Hon. Mr. McKeough: I didn’t say that.

Mr. Chairman: The hon. member for Timiskaming.

Mr. Bain: Thank you very much, Mr. Speaker -- Mr. Chairman. Well, I am sure that one day you will be elevated officially to the position of Speaker. You do such a fine job.

Mr. Chairman: Not in this chair.

Mr. Bain: Specifically, I would like to ask the minister exactly why the Canadian Arctic Resources Committee is going to cost us $25,000? What does this committee do? Who is to be on it, and what do you expect it will accomplish?

Mr. Good: That was answered only 15 minutes ago.

Hon. Mr. McKeough: I answered that, I think, for 10 minutes, about three-quarters of an hour ago. If you want me to answer it again, it’s your time.

Ms. Bryden: Mr. Chairman, I want to pursue a little bit more this question of whether Ontario can do things on its own or whether it has to wait on the federal government. I certainly don’t think that it is a good reason, in terms of policy, that we should not spend money just to keep people off unemployment insurance. I think it is much better for people to be working, self-supporting and paying taxes, whether or not we are saving the federal unemployment insurance money.

Mr. Good: Just to make the feds look bad, you would have them unemployed.

Ms. Bryden: I would just like to ask the minister, now that this unemployment rate has reached 6.5 per cent and in view of the fact that I understand the construction industry’s unemployment rate in the city of Toronto is about 30 per cent --

Mr. Shore: Are you pro-Liberal?

Ms. Bryden: -- whether he will not consider adopting one or two of those Manitoba initiatives, such as special municipal loans and a general emergency fund, to enable the municipalities to put most of those people back to work, both on summer and winter projects, in the municipalities that have high unemployment rates at the moment. We all know that they have had to cut back their capital expenditures drastically as part of the restraint programme, but it seems to me this is false economy if people are out of work and are having to go on welfare and unemployment insurance when we need a lot of the projects that were cut out. Therefore, I would like to ask the minister whether he is prepared to reconsider that part of his budget and make substantial funds available for both municipally operated capital works, and possibly some accelerated provincial capital expenditures, in areas of high unemployment?

Hon. Mr. McKeough: Not at this time.

Mr. Chairman: Shall vote 1004 carry?

Ms. Bryden: Is the minister not going to reply?

Hon. Mr. McKeough: You asked me whether I am prepared to make changes in the budget a month and six days after I brought it in, and in our policy, and the answer is not at this time.

Mr. Haggerty: I would like to direct a question to the minister concerning the $215,000 for the Canadian Intergovernmental Conference Secretariat. Could he give us an explanation in more detail as to what this is all about, and what benefit there is to the Province of Ontario?

Hon. Mr. McKeough: We refer to this as the Henry Davis secretariat, perhaps somewhat irreverently -- no, actually very deferentially --

Mr. Laughren: Make up your mind.

Hon. Mr. McKeough: -- because Mr. Davis has done a rather fine job in our view over the years. In terms of the number of intergovernmental meetings, federal and provincial, which are now held, some of the provinces felt very keenly that the secretariat for those meetings should be provided, not by the government of Canada, and not by the provinces for that matter, but should be provided independently. So there has grown up what is known as Henry Davis’s secretariat, and we have supported it fully and said we were prepared to pay our share. I think the government of Canada pays half now and the other 50 per cent is paid by the provinces. I assume that our share, based on population, is 35.8 per cent of the expenses.

When those first ministers’ meetings are held or a number of interprovincial meetings -- the minutes are kept and the arrangements are made by Mr. Henry Davis’s secretariat. He is in External Affairs now for a while, and all of us have a great deal of confidence in him.

Mr. Haggerty: Mr. Chairman, again to the minister, are these minutes available to the members of the Legislature?

Hon. Mr. McKeough: No.

Mr. Haggerty: Why not? You are spending public money.

Hon. Mr. McKeough: It depends whether it’s a closed meeting or an open meeting. Obviously if they were closed meetings, as was the last meeting of the ministers of Finance, the answer would be no.

Mr. Haggerty: Mr. Chairman, again on this particular point, we’re dealing with government policy. We can see a heavy expenditure all the way through here, but apparently the members of the Legislature are not permitted access to that information -- which they should be.

Ms. Bryden: My first question on item 3 is with regard to the recommendation of the Camp commission for a $2 check-off on income tax for people who wish to support a political party. I think the idea was that you could mark which party you wished to support on your income tax form and $2 of your tax would be sent to that political party by the federal officials. It’s a very simple administrative procedure.

Every time we ask the Minister of Revenue (Mr. Meen) whether he is negotiating with the federal government to do it -- at least in Ontario -- he says he has nothing to do with tax policy. He says these negotiations are in the hands of the Minister of Treasury, Economics and Intergovernmental Affairs. This is why I am raising it under this item. We have not got an answer from the Minister of Revenue.

I would like to know: Has the government been negotiating with the federal government regarding the implementation of this recommendation of the Camp commission? We feel it would be an eminently sensible way of allowing people to make a small contribution to the political party of their choice, and make the parties less dependent on the big donations from big corporations.

Hon. Mr. McKeough: Mr. Chairman, government policy is agreeable to the suggestion, I think, without having formally approved it in any way. We have asked the Minister of Revenue to pursue it with the Minister of National Revenue, but to date there has been no success in those negotiations.

Ms. Bryden: Can you give us any indication of why the government of Canada is objecting to this? Do you think it’s administratively difficult or that they don’t wish to do it? It’s only Ontario we’re asking for. We’re not asking for it for the whole of Canada.

Hon. Mr. McKeough: That’s part of the problem.

Ms. Bryden: Could it not be done through the Ontario pink form on the income tax which doesn’t affect any other province?

Hon. Mr. McKeough: You’ll have to ask the Minister of Revenue as to what specific objections have been raised. But it’s administrative, I think. Maybe it’s philosophical too -- I don’t know.

Mr. Haggerty: One more question for the minister, concerning the Bureau of Municipal Research. I was concerned about the remarks of the member for London North when he mentioned the Institute for Research on Public Policy. The minister indicated that maybe this expenditure wouldn’t be used this year on this particular vote. I was wondering about the particular field that deals with municipal research. I think they should have more money for research.

There are a number of difficulties facing the municipalities, and I can point to the transitional grants from the provincial government to the municipal governments. That always is a rather contentious affair with the two bodies of government. There are many things that they can do in this particular field and I’m sure that the municipal councils would like to see more research done in the field of local government.

I suppose that this is another area that you can cover in some of your views on regional government, too. I don’t know if this would include some of the present studies being carried on in the Ottawa-Carlton area -- was it by Prof. Mayo?

Hon. Mr. McKeough: No. This is a specific non-profit association, located in Toronto, which has been around for a long time. It was privately funded for a very long time and, for two or three years now, we have been assisting in its funding. I don’t know whether they have asked for more than this. But their entire budget isn’t that large. I would guess it would be several hundred thousand dollars. I wouldn’t want to see us getting more involved. But they do very excellent work; mainly to date with respect to Metro and Toronto. I am aware that they are now looking also for private sector support in a couple of cities, one in Ontario, and I think the mayor of London has gone on the board of the Bureau of Municipal Research. I don’t know whether London is contributing an amount or not. They are also doing some contract work for municipalities which municipalities would pay for.

Mr. Haggerty: I want to pursue this a little bit further. No doubt they are doing an excellent job in certain larger communities throughout the Province of Ontario. I am thinking about the smaller communities, the smaller towns and villages. Perhaps I can relate to some comments on this proposed bill to establish the community self-government bodies in northern Ontario in some of these communities that have no government whatsoever.

Hon. Mr. McKeough: You are really stretching it a bit if you wanted to talk about --

Mr. Haggerty: I am stretching it a bit; there is no doubt about it. I want to get the minister’s comments on the matter of local government in northern Ontario where it has been promised for the last couple of years by the minister. These municipalities are looking for the right of self-government in that particular area. What studies have been done or is this group doing, in this particular area then?

Hon. Mr. McKeough: Nothing.

Mr. Haggerty: Nothing?

Hon Mr. McKeough: Not to my knowledge.

Mr. Chairman: Shall vote 1004 carry? The hon. member for Nickel Belt.

Mr. Laughren: Was the member talking about the minister’s --

Hon. Mr. McKeough: No. Bill 102.

Mr. Laughren: Yes, is that the bill you were talking about?

Hon. Mr. McKeough: Yes.

Mr. Laughren: I understood that there was some work being done now from within your ministry.

Hon. Mr. McKeough: Oh yes, but not to my knowledge, by the Bureau of Municipal Research. Perhaps I could comment: I expect to be tabling a rather lengthy statement and report on Bill 102 within the next three or four weeks.

Ms. Bryden: It seems to me that under this vote intergovernmental affairs deals with the relationships between the province and its municipalities and that we could discuss the Edmonton commitment. I presume it may also be discussed under the municipal vote, but this is the broad relationship between the province and the municipalities. I would like to --

Hon. Mr. McKeough: It sort of puts a connotation on it that has nothing to do with money. Vote 1005 is a better place, but it doesn’t matter to me.

Ms. Bryden: Is it your feeling, Mr. Chairman, I can proceed under this vote?

Mr. Chairman: The minister is prepared to deal with it under vote 1005.

Ms. Bryden: Vote 1005? I don’t see it fits under 1005, with respect, sir.

Hon. Mr. McKeough: Under fiscal policy, or under the whole tax reform programme, which is 1007.

Ms. Bryden: With respect, I don’t think it is just tax reform. It is the relationship between the municipalities and the province.

Hon. Mr. McKeough: If you want to talk about it here, then let’s talk about it here.

Ms. Bryden: With regard to the Edmonton commitment, perhaps we should go back a little bit and look at it. It was first enunciated in November 1973 at the tri-level conference in Edmonton; that is where the name came from. The statement there which the then provincial Treasurer of Ontario, John White, made to the conference was a pledge of how Ontario would treat its local government with regard to financial aid. It followed after a long period of municipal and local government agitation for greater support from provincial governments and federal government, too, because most of the problems and most of the costs seem to be at the local level, with the growth of cities, the growth of transportation needs, the growth of education needs and the growth of health needs and so on.


At the Edmonton conference, the then provincial Treasurer, Mr. White, pledged three things. I won’t go into two of them because I am mainly concerned about the one with regard to the level of provincial assistance to local government.

The pledge was that such assistance should be at a rate not less than the rate of growth in provincial revenue. My first question is: Does the present provincial Treasurer still accept that particular version of the pledge which was that there would not be a ceiling on provincial aid to municipalities but it would be not less than the rate of growth in provincial revenues? That’s question No. 1. I don’t know whether or not the minister wants to answer that before I go on to the others?

Hon. Mr. McKeough: Obviously that is one interpretation. The interpretation, as I have said, is that we are going to continue to look at this on a cumulative basis over the three-year period since the commitment has been in effect, counting this year. We are honouring that commitment but I guess in two years out of the three we will not, on an individual year basis. We did not in the first year; we will not this year. We certainly did last year and on the three years we will be -- the latest figure is -- $21 million ahead.

Ms. Bryden: Mr. Chairman, the minister hasn’t really answered my question which was does he accept the phrase “not less than” which was in the original commitment?

Hon. Mr. McKeough: On a cumulative basis.

Ms. Bryden: It means there is not a ceiling on the commitment of the rate of increase in provincial revenues but that it should be at least up to that level. Does he accept that there is not a ceiling on it?

Hon. Mr. McKeough: On a cumulative basis, yes.

Ms. Bryden: With regard to that then, could he tell us at what stage, what point in time, the local governments were first informed that this formula was to be based on a sort of after the fact bookkeeping? I think most of them understood when it was first made that whatever figure came out in the provincial budget for the estimated rate of provincial increase in revenues and, therefore, the estimated rate of increase in local government grants, that figure was the figure for the coming year.

Municipalities do need this kind of certainty. They do have to make their own budgets shortly after the provincial budget.

Hon. Mr. McKeough: The answer to the question would be that in March, 1975, I discussed with the fiscal arrangements committee, both before and alter the budget as I recall, the fact that we would be paying out something more than the rate of growth because there was a deficit from the previous year.

Ms. Bryden: I wonder if the minister could let us have copies of that communication of March, 1975? I personally haven’t seen it; I presume it went out to local governments --

Hon. Mr. McKeough: No.

Ms. Bryden: Was there a statement?

Hon. Mr. McKeough: There was a discussion before the budget and, as I recall, after the budget. I think the 1975 budget, of course, which would have been well circulated, had a breakdown of the Edmonton commitment and showed the previous years at that point still estimated at underpayment and the fact that there would be an overpayment in 1975-1976, and that the sum total of the two years would be that the commitment was being met.

Ms. Bryden: With respect, the 1975 budget, I think, said that it appeared that there had been an underpayment if you took the increase in provincial revenues as the ceiling and that the minister was giving additional moneys to municipalities. That was what he used as his justification that there had been what appeared to be an underpayment on the Edmonton commitment in the previous year. He did not say that if there had been an overpayment, it would be taken back in the following year.

This plus-and-minus accounting was not brought to the notice of the local governments until sometime in 1975 -- and that’s what I was trying to pinpoint, just when the local governments were notified and in what form in 1975. I understand that they were notified in November when the minister made his statement at the beginning of the restraint programme. But was there any notification prior to November that there would be a deduction if more had been paid than would be justified by a formula based on the increase in provincial revenues?

Hon. Mr. McKeough: Not directly.

Ms. Bryden: Thank you, that was one point that I wanted to clarify.

The next point is, if we are going to have a plus-and-minus formula, is there not an argument for involving the local governments in the interpretation of that formula, as to which rate of increase of provincial revenue you take?

Do you take the one that comes out on budget night? Or do you take the one that comes out after all the books are closed, two years hence, and they work out some plus and minus, which may require a very large cutback -- as has happened this year -- and may throw all municipal budgets into a complete loop -- as has happened this year?

Shouldn’t there be some sort of floor on any plus or minus that you might consider taking back? Or preferably, shouldn’t you really give them whatever you estimate on budget night is the amount they get, without any plus-and-minus calculations? It seems to me that gives the municipalities some share in the provincial Treasurer’s forecast of how much revenue he is going to get. It protects them from any cutbacks he may make just prior to an election, as happened last year. They in effect share in the rate of growth of provincial revenues as forecast in the budget, and they can plan on that basis.

Would the Treasurer not consider sitting down and negotiating with the municipalities the interpretation of the Edmonton commitment on a more rational basis, with some sort of a floor under it? I am not sure that it should have a ceiling because it’s possible the municipal expenditures may be growing faster than the growth of provincial revenues, and we may decide that they need the money for services more at the municipal level than at the provincial level.

In other words, is he prepared to make it much more of a partnership -- which is what happens at the federal level? They sit down and negotiate to some extent the federal-provincial tax-sharing arrangements --

Hon. Mr. McKeough: You’ve got to be kidding!

Ms. Bryden: -- but in this province we have never actually sat down with the municipalities and discussed the actual interpretation of the Edmonton commitment.

Mr. Shore: Mr. Chairman.

Mr. Chairman: The hon. member for London North.

Mr. Lewis: Are you speaking on this matter?

Mr. Shore: Yes. Mr. Chairman, I am going to reserve my right to speak on this matter a little more fully where I believe the vote really should be.

However, since the subject has been brought up, I just want to leave this comment on the table. This whole subject matter of the Edmonton commitment -- or lack of commitment -- is something that requires much more in-depth study. It has been talked about for many months, and we could debate it at great length.

I am satisfied in my mind -- and the minister is probably satisfied in his mind, although I am more committed to my satisfaction -- that the government has not met its commitment under the Edmonton agreement. Many people believed it was a commitment, leaving the technical aspect aside, and that it wasn’t just a statement. The minister may be satisfied in his mind that he has met its terms, but the facts are that in relation to the people it was affecting, most of those people, at least, never understood it.

In my opinion many people understood it, and the commitment hasn’t been made. Now, the minister can continue to state that he has, and he can continue to bring up the overpayment and the underpayment and all the other things. But the facts are as I read it -- and as the facts are the most important thing -- that the people who were being affected by it, certainly didn’t understand it that way. That’s really the important subject matter.

Mr. Lewis: That’s fair.

Mr. Shore: I think the member for Beaches-Woodbine (Ms. Bryden) brings up a valid point which has been brought up many times before and I would like to hear the minister comment on it. I cannot understand why he would refuse to discuss this type of issue. It is so important a matter between municipalities and the province. This is a very important matter -- why would he not want to discuss it? Not uniformly state what it is going to be, but discuss it in conjunction with these municipalities. The same minister is constantly ridiculing -- rightly so in many respects -- the attitude of the federal government relating to provincial matters.

Surely, if he believes that this interaction and partnership concept is important at the federal-provincial level -- forget how they are treating him and his government for a moment; that’s an argument between those two -- surely it is equally important, if not more important, that this relationship and constant discussion, review and debate should take place between the municipal parties and the government of Ontario.

Secondly, I want to put this on the table and I haven’t had a satisfactory answer. With all the economists, the fiscal people, the planners and all the things I see here, I am not satisfied that the minister has given me any reasonable answer as to why we should not be able to do something on more than a one-year planning basis. Forget all the Edmonton commitments for a moment. Surely it is not unreasonable, even if the province doesn’t want to do some multi-year fiscal planning, that if municipalities want to do it they should be given a positive support approach to it.

I don’t want to hear necessarily that we can’t commit the budget next year and so on. I’ve heard that. I respect that budgets can change; Lord only knows, we’ve had it changed regularly year to year. Surely a plan of attack with some thought and objectives could be presented so that the municipalities can establish priorities. I can tell you that if that type of programme were developed, you would get more return for your dollar. You wouldn’t have to react continually to something. You would be able to plan it.

I would like to hear why the minister feels that this great province, with a $12 billion budget, its imagination and its quality staff and 20 ministers cannot address itself to some type of planning on that basis.

Hon. Mr. McKeough: It is completely wrong to say that we don’t. What utter nonsense to suggest that programmes which are introduced in the House don’t carry forward. What you are attempting to say is that provincial support for education, for example, could change from one year to the next.

The fact is that the municipalities, with I would think a great deal of certainty, can count on what is going to be coming from the province to them, depending on equalization factors among other things. The rate of growth obviously is going to vary from year to year, and when major changes are made in grant programmes, in all ministries, those things are thought out year by year and discussed with them before those changes are made. To say that there isn’t some certainty of what is going to happen from year to year, in 90 per cent of the cases I would say would be completely wrong.

Mr. Shore: It is easy to say 90 per cent would be wrong. The facts are there has not been any planning. The minister himself has so stated in a public forum -- when I asked why don’t you believe in and why can’t you do multi-year planning, the answer was no by the minister.


Mr. Chairman: Shall item 3 carry?

Mr. Shore: No.

Mr. Lewis: Just before item 3 carries, I was sitting in my office doing other things, listening to the debate taking place here in the Legislature, and I felt I wanted to enter for a minute or two on the question of municipal finance. It was being discussed at such a high level of financial integrity as though there was some consistent pattern to the premises which underlie the Edmonton commitment and what followed it, when in fact, and I think it is important that at least it be said again in this debate, that we are dealing with political decisions entirely self-serving, where the municipalities are manipulated at will for the purposes of government.

What is interesting at this point in time, in 1976, is the very strong sense among municipal leadership across the province, that they have not been dealt fairly with by the government. It may be in the mind of the Treasurer that he has given them cumulatively what they are entitled to; it may be in the mind of the Treasurer that he discusses with them before and alter budget, what the implications of the budget will be; it may be in the mind of the Treasurer that he does multi-year planning by the simple reality that certain aspects of the budget perpetuate from year to year; but the truth is that, in an unprecedented way, for the first time in a very long time, even the Tory members of municipal councils right across the province are disheartened by the bad faith shown by government.

I don’t think that is a particularly remarkable statement. I was at the Ontario Association of Small Urban Municipalities to speak at a luncheon no more than a week or 10 days ago. The vast mass of the audience, I am quite ready to concede, were Conservative and Liberal adherents involved in municipalities. A number of the Conservatives approached me, not pretending that they will discard the Tory party, but making it absolutely clear that the fiscal arrangements they thought had been entered into were betrayed by this government. It had, in fact, shaken them significantly in this particular year.

To pretend there was some kind of financial and economic rationale to the Edmonton commitment which has been honourably adhered to is to stand logic and experience on its head. The Edmonton commitment that was made by John White in October of 1973 was a sell-serving political decision. On the face of it, the “not less than” formula, which my colleague for Beaches-Woodbine pointed out, sounded reasonable, and at no time until the fall of 1975 was there the slightest hint to the municipalities that there would be some kind of recovery for a payment in excess of the rate of provincial growth in a previous year.

Anyone who wants to read the budget of March, 1975, will see, as the Treasurer has acknowledged, that you paid more than you need have paid. Nowhere during that budget address was there a suggestion that you would recapture money if you paid beyond the growth of provincial revenue; nowhere. Because most of us who have looked at that budget and previous budgets have scrutinized it carefully, and the first suggestion of taking back a so-called overpayment emerged in the fall of 1975 after the election campaign when you saw yourself in serious economic difficulty, and when you realized you were launched into the restraint programme with a vengeance.

So in order to justify giving the municipalities first between five and six per cent, then around 8.1 per cent, finally 7.8 per cent, you constructed a rationale based on a new interpretation of the Edmonton commitment. One of the funniest documents in municipal experience, and I would recommend it to everyone in the Legislature who has not yet seen it, is the January edition of Municipal World, 1976, in which there is a careful chronology of all of the interpretations, reinterpretations, and misinterpretations that have been placed on the Edmonton commitment by members of this cabinet from October 1973 to this present day. It was done in bad faith from beginning to end.

As a matter of fact, quite uncharacteristically for this Treasurer, he even indicated in the fall of 1975, when the first suggestion of overpayment was made, and in January and in February of 1976 when he was dealing with various municipal associations, that even though there was an overpayment, it would not be taken back in the fiscal year 1976-1977 because of the particularly difficult time which the municipalities were facing. For him, in an uncharacteristic way I’d say, that public commitment was repudiated in the budget when he revealed that the tax increases would allow the province to recapture $98 million of the so-called overpayment.

Right from the word go this whole business of funding the municipalities has been intensely political, related to the dates of an election and to the financial problems of the Treasurer’s administration of the economy of Ontario.

The original commitment was made by John White. The words “not less than” caused you problems, and in a 1974 budget you took out the words. Then John White went to a provincial-municipal liaison committee in May, 1974, and said: “Let there be no misunderstanding, the words not less than remain, that’s our commitment.”

Then in 1975, in the budget, you talked about the possibility of giving the municipalities more because you had a little more money. You never talked about the possibility of taking it back from them through any alleged overpayment. Because you had to cut certain taxes in advance of the election, like the sales tax in certain areas, you lost your revenue. As my colleague from Beaches-Woodbine pointed out, it’s a hell of a way for the municipalities to budget, based on a revenue growth predicted in the budget of 1975 and then altered in the fall of 1975 because it didn’t suit your political purposes.

The election campaign having been over and the Tories frantically casting around for a theme which would win the support of Ontario and re-engage majority government, stumbled upon restraint. Restraint had to be imposed upon the municipalities as upon all others. How do you bring the municipalities down from 12 per cent, 14 per cent, 15 per cent or more which you’ve given them in previous years to a level of eight per cent? Ah, hah! Suddenly the Edmonton commitment is to be interpreted in terms of overpayment.

I can see you chuckling in the senior aristocracy of your civil service and amongst your cabinet colleagues as you worked out the percentages which you could deduct from the various municipal grants in order to get you down to 7.8 per cent or 8.1 per cent -- or whatever it ended up as, 7.8 per cent I guess it was.

I must say to you that never has there been an undertaking more politically motivated, more self-serving than the funding of municipalities in every sense. You change the wording of the first commitment. You alter the commitment based on the needs of an election campaign before and after. You break your word, which is positively unprecedented.

I’ve very rarely seen the Treasurer break his word. He holds to it in a more foolhardy and relentless fashion than any man I’ve ever known. To say as a norm, to say in the fall of 1975 and in January and February, 1976: “We will not recapture the overpayment in the next fiscal year,” and then to turn that around in the budget and to have to admit it, even for the Treasurer that caused a gasp of breath around Ontario amongst the municipal politicians.

Then, on top of everything else, you shift the regressive tax base in Ontario to the municipalities in order to get off the hook yourself. There is not a kernel of honour in the whole process from the Edmonton commitment of 1973 to what the municipalities are experiencing today. I don’t think anyone should invest it with financial dignity as though it were part of a scrupulous formula on which you base a plus and a minus. My colleague from Beaches-Woodbine, God bless her, is such a first-rate economist as well as a member of the Legislature that she is inclined to view it that way, having accepted what the Treasurer says intermittently about how the formula was arrived at. That’s true, That’s the way you’re dealing with it now, but let no one pretend that was ever your original intention. Your original intention was to manipulate your money to the municipalities and you have done that artfully.

In the process, just as a footnote, just as an addendum, municipalities all across the province and municipal leadership all across the province are dismayed and disillusioned by the behaviour of the government. Although it is a matter of relative frivolity now, and although there’s a lot of chest-beating when the Treasurer speaks to municipal officials, I for one am surprised at the depth of unhappiness which the municipalities feel as a result of your shift in policy.

Had you said to them, I suppose: “This is a time of restraint and we’re simply jettisoning the undertaking we made,” they may have understood that. But when you suddenly say to them: “We’re reducing you to 7.8 per cent because of an overpayment, and despite what I said we’re recapturing that overpayment to a level of $98 million in 1976-1977”; then you say to the municipalities in no uncertain terms the provincial government works in bad faith, and they look at you as though it’s ridiculous when you go off to Ottawa and make exactly the same argument to the federal government as they have been making to you for the last several years, using precisely the same rhetoric.

If you say to the New Democratic caucus, as I suppose would be your inclination, that was another $98 million which we needed and we weren’t prepared to add to the provincial debt, obviously we can show you, by way of a natural resource tax or a point increase in the provincial corporation tax, where we would have had that money. It would have suited the government better to level with the municipalities about your change of heart in funding them than to have engaged in the duplicity which every single municipality I have talked to understands.

Those municipal leaders are not normally and naturally partial to the NDP, and I don’t pretend they will be in the future, but they are incredibly angry and disheartened by the behaviour of the government in the last budget and in all the subsequent transactions. If you want to understand why you’re still in trouble, even though you’ve employed restraint, then just look at what you’ve done to the municipalities as well as what you’ve done to the small community hospitals.

There; the political interpretation is on the record as are the others. Those are things which we’re watching throughout the province.

Mr. Chairman: Shall item 3 carry? Carried. This completes vote --

Mr. Shore: Hold on, what’s going on here?

Mr. Chairman: I said shall item 3 carry, and that would complete the vote. I understand we’re taking it item by item.

Mr. Shore: Mr. Chairman, would it be unreasonable or too much to expect, since you did allow it, and since the minister agreed to have it brought up at this time, that the minister would wish to comment or respond to some of the observations in this area?

Mr. Lewis: He already has responded.

Mr. Shore: No? He does not wish to respond.

Mr. Chairman: Shall vote 1004 carry?

Vote 1004 agreed to.

The House recessed at 6 p.m.