Legislative Assembly of Ontario

The House met at 10:02 a.m.

Prayers.

FOOD INDUSTRY INQUIRY

Mr. S. Smith: On a point of privilege, Mr. Speaker: In this morning’s Globe and Mail on the front page there was an article which, in the headline and in the first paragraph, suggested very strongly that the Premier (Mr. Davis) has refused some suggestion made to have members of this Legislature sit on a food prices and food trade practices royal commission.

I would like to have the record set straight, because the same matter was then covered in an interview with the Minister of Agriculture and Food (Mr. W. Newman), in which the question asked of the honourable gentleman clearly indicated that the interviewer on the CBC believed that somehow or other was what was suggested and what was turned down. First of all, I want to read into the record, from Hansard, an excerpt from the committee itself. I know that a reporter from the Globe and Mail covered that committee, and I want to read the thing. This excerpt starts on page R-1225-2 of the draft Hansard for June 21.

“Mr. Eaton: To comment on Mr. MacDonald’s suggestion that a member from each party be on that committee --

“Mr. Nixon: Not from each party.

“Mr. S. Smith: A nominee.

“Mr. Nixon: A nominee.

“Mr. Eaton: A nominee; that’s what he said.

“Mr. Lane: That’s not what you said. You said a member from each party.

“Mr. S. Smith: Not a member; a nominee. You might nominate somebody from the food industry et cetera.

“Mr. Eaton: Not a member of the Legislature?

“Mr. S. Smith: Not a caucus member, no. Not even a member of a party.

“Mr. Eaton: That’s the way I took it. I was going to suggest what you’re saying, that it not necessarily be a member of the party.

“Mr. S. Smith: Not even a member of the party.

“Mr. Eaton: Right.

“Mr. Nixon: I don’t think it would be proper for it to be a member of the Legislature.

“Some hon. members: A nominee.

“Mr. Eaton: I can accept that idea then.”

Mr. Nixon: Good for Bob Eaton.

Mr. S. Smith: Yesterday, in the House during the question period, among other things, I said to the Premier, and again I quote: “I don’t particularly think it has to be a member of the judiciary. In fact, it might be of interest to the Premier that the Liberal nominee would be the very person suggested by the Minister of Agriculture and Food, which is Mr. Poole, the counsel of the committee.” He is hardly a member of the Legislature.

Mr. Nixon: Or hardly a member of the Liberal Party.

Mr. S. Smith: Later in the debate on this very matter, I said: “Let us be clear: It was never the intention -- and this was made clear in the committee -- that these would be members of the caucus nor even members of the party. They would merely be people knowledgeable in the food industry and suggested by all three parties.” In fact I suspect there’s even a legal reason why MPPs ought not to be on royal commissions.

That having been made so clear in the committee and having been clarified yet again in the House yesterday, I must say I’m a little dismayed. I wish to take this opportunity to set the record straight so that the debate, however it proceeds in the public mind, at least has real facts as its basis.

It may well be, for instance, that the Premier wishes to turn down any suggestion that the members of the royal commission should be those buried in the local cemetery, and he would be quite right in so doing. But that was never suggested. Never was it suggested that MPPs should be on that commission.

Hon. Mr. Davis: Nor was it ever excluded.

Mr. S. Smith: It was.

Mr. Deans: Yes, it was. We specifically said in the committee --

Hon. Mr. Davis: The report doesn’t say so.

Mr. S. Smith: I’ll send you a copy of Hansard. Do you want a copy of it?

Hon. Mr. Davis: The report didn’t say so. When you drafted that report, it didn’t say so.

Hon. W. Newman: Mr. Speaker, I would just like to read part of the resolution that was moved by Mr. MacDonald and seconded by Mr. S. Smith: Maybe they didn’t intend it to read in the way the resolution came out: “A nominee of each of the Progressive Conservative, Liberal and New Democratic caucuses of the Legislature…”

Mr. Deans: Don’t make an ass of yourself. You were in the committee and you heard the answer.

Mr. S. Smith: A nominee by the caucus, because you can’t have it by the party. You were there for the debate and you know it.

Mr. Speaker: Order. It is entirely appropriate for any member of this Legislature, or indeed any party, to get up and correct the record if he feels that what has been said has been misinterpreted. The honourable member has done that.

STATEMENTS BY THE MINISTRY

AID TO ITALIAN EARTHQUAKE VICTIMS

Hon. Mr. Timbrell: Mr. Speaker, members will recall that following the disastrous effects of the earthquake of May 1976 in the Friuli region of northern Italy, the government of Ontario responded to the appeal for funds to build housing for the earthquake victims. This response was co-ordinated by the National Congress of Italian Canadians.

To construct the housing, more than $4 million was collected from across Canada. Of this amount, I am proud to say, the government of Ontario contributed $500,000 and a further $1,943,000 came from community support in 21 Ontario cities.

At the beginning of May 1978, a delegation comprising representatives of the National Congress of Italian Canadians; two Canadian federal cabinet ministers, Honourable Norman Cafik and Honourable Monique Begin; Senators Bosa and Rizzuto; Honourable Jacques Couture for the government of the province of Quebec; Ron Tessolin, a member of the Legislative Assembly of Alberta; Joe Piccininni, representative of the city of Toronto; and myself, representing the Premier and government of Ontario, went to formally open the completed housing projects.

I wish to report the funds were used to construct solid, earthquake-resistant, one-storey homes. To date, 92 have been built in Venzone, 59 in Forgaria and 30 in Pinzano. Each home stands on a full basement made from reinforced concrete, with a frame from timber made to flex without breaking should another earthquake strike.

Homes for the aged were also built in Bordano and Taipana which each allow accommodation for 40 people.

The Italian government and people gave their sincerest thanks to the people of Ontario and Canada.

Many Italians who survived the ordeal said to the delegation: “It is a Canadian heaven. It’s like a dream. I am really amazed to see Canadians come here and do this. Please say thanks to all Canadians. They have just been wonderful.”

In conclusion I wish to report the accomplishment of the original goal of assisting some of the people of the Friuli region in their time of need. As Canadians we can take pride in this project; a unique venture organized by Canadians to help the country of their ancestry, funded by citizens and all levels of government; a tribute to the energy and ability of the citizens of our country.

HEALTH RECORDS

Hon. Mr. Grossman: Mr. Speaker, on May 26 the honourable Leader of the Opposition asked me a question concerning the hiring by insurance companies of investigators to obtain confidential medical information. I thought I would use this time to reply rather than the time of the question period in order to be fair to the House because of the length of this answer.

As I reported to the House at that time, there was one case last year where an insurance adjuster was involved. The adjuster in question was Mr. Lawrence Lander, and the complaint was received in the office of the superintendent of insurance from the solicitors whose client had been the subject of the investigation. The complaint involved the release of information by a doctor to the adjuster and contained a copy of the complaint and the disposition thereof by the College of Physicians and Surgeons of Ontario.

Both Mr. Landers and the doctor have given evidence before the Royal Commission on the Confidentiality of Health Records.

The complaints committee of the College of Physicians and Surgeons of Ontario decided not to lay charges against the doctor among other reasons because he had assumed, wrongly as it turned out, that the adjuster had obtained the necessary consent to the release of this information.

The matter was referred to the health disciplines board which upheld and confirmed the decision of the complaints committee of the college.

A copy of the health disciplines board decision was referred to the Honourable Dennis Timbrell, Minister of Health, on July 11, 1977. It is understood that this matter was investigated by the Ministry of Health and the matter was discussed with the hospital concerned in order to eliminate such errors of record security in the future.

The adjuster confirmed that he had no written authorization from the client, but had asked the doctor to make a report. The report was to be used for assessment purposes, and for the purpose of setting up an injury claim reserve. This was done and the doctor was paid.

The claim was subsequently settled, and the adjuster stated that the report was not used in any way in connection with the settlement.

There was no specific violation of the Insurance Act. However, the adjuster was cautioned that he should not become involved in any way in obtaining medical information without the proper authorization of the person concerned.

The royal commission canvassed this matter with the health disciplines board. As well, the superintendent of insurance released his file to the royal commission of inquiry on March 17, 1978. This matter was raised in the Legislature with my colleague, the Minister of Health (Mr. Timbrell), last November. As I stated previously, there was no investigator involved.

On the question of pretext interviews of accident victims by private investigators, now being reviewed by the royal commission, there was one instance reported this year to the superintendent’s office concerning the involvement of insurance companies with private investigators. In that case CIAG retained Centurion Investigations Limited, which have been before the royal commission to obtain a pretext interview of an accident victim. No release of confidential medical information was involved. In this case the claim had not been settled.

The matter was investigated by the superintendent’s office and, as a result, the insurer placed a ban on all pretext interviews and all information obtained was turned over to the victim’s solicitor. Further, the Co-operators Insurance Company drafted a specific code of conduct for its claims representatives which expressly included this ban. It is also being discussed with the royal commission staff. These instructions were based on the Insurance Bureau of Canada instructions for company adjusters which were adopted for general insurers on March 1, 1977.

The effect is to require all adjusters to fully identify themselves and their interest to any claimants, and specifically to prohibit them from seeking to influence any public officer, official, or servant or employees of any institution by any financial inducement.

In addition, of course, the superintendent of insurance, with respect to proposals presented to the select committee on company law of this Legislature on part XIV of the Insurance Act, has recommended that a uniform code of conduct of claims settlements be prescribed for all persons dealing with claims on behalf of insurers in this province.

I want to reconfirm to the House that upon receipt of the Krever report we will proceed to take appropriate action against any insurance companies or adjusters using, or attempting to use, improper methods to obtain information.

[10:15]

With respect to the supplementary question of the member for Welland-Thorold concerning the Medical Insurance Bureau, I would like to inform the House that the principal function of this bureau is to act as an information exchange office on behalf of member life insurance companies. It does not generate information on any applicant for life insurance but merely acts as a depository of data collected by its members.

The rules of conduct of this bureau aim to preserve the privileged nature of the information it handles. The rules require that a member company give every applicant for life insurance a pre-notice informing the applicant of its intention to make a brief report to the bureau on the information at hand regarding his or her insurability. That is the authorization that the honourable member was speaking of.

The rules also require a member seeking information to obtain an authorization signed by the applicant specifying the company that is to receive the information from the bureau. Information other than the applicant’s name, occupation, birth date, and birthplace, is kept in code and is released in this form to a duly authorized insurer. Correspondence regarding medical impairments must be handled solely by the medical director of the insurer. The bureau has pledged to release, upon request from the individual concerned, medical information to the attending physician and other information to him or her personally.

The procedure is aimed at achieving maximum accuracy of personal information by giving the opportunity to the individual concerned to correct any errors affecting the personal record.

MIB is not a consumer reporting agency within the meaning of the Consumer Reporting Act, which is administered by the business practices division of my ministry.

When the act became law in 1974, a review of the operation of the bureau was conducted by the ministry, including a visit to MIB headquarters. As a result, MIB agreed voluntarily to adopt procedures of notification, correction, and disclosure that appeared to be compatible with the requirements of the Consumer Reporting Act.

The bureau was originally established because life insurers, in most cases, had only the information provided by the applicant to rely upon. There were instances where this information was inaccurate, misleading, or incomplete. The bureau was, therefore, established to avoid unwarranted underwriting losses which would have to be offset by charging a higher premium to all consumers.

The superintendent of insurance discussed this matter with the Canadian Life Insurance Association some three weeks ago. The life industry has recently been in touch with Mr. Justice Krever’s commission and will be preparing a submission to the commission both on the general problem under review and on the function of the MIB.

I do have some serious concerns. First, of course, the confidentiality of that information; secondly, the implications of having one large repository for all this information in terms of privacy of our citizens; thirdly, I am concerned that although the forms being used by insurance companies appear to be legal, proper, and sufficient to obtain clear consent from their clients, nonetheless, I wonder about the degree to which the public really understands what is happening to their medical information. Accordingly, I will be very interested in the report of Mr. Justice Krever. After receiving it, I can assure the House that I will be conducting further dialogue with the insurance industry and will report to this House on the subject.

Thank you, Mr Speaker.

SUMMER RECESS

Mrs. Campbell: On a point of privilege, Mr. Speaker. I recognize that it is the rule of this House that one rises on a point of privilege as soon as possible after the event. However, I am rising because of the motion by the government House leader yesterday and I did not actually find the wording of the motion until I took my seat today and looked through Hansard. So I was in no position to raise the point.

The motion by the House leader for the government, which was approved by the House, was that when the House adjourns for the summer recess it do stand adjourned until a date to be named by the Lieutenant Governor by her proclamation.

I would submit that motion is unconstitutional, on this basis: If one realizes that this House is the daughter of Parliament, we recognize that a reigning monarch in England lost far more than his crown by usurping the powers of government, the powers of the Parliament. It has been ruled ever since that the adjournment of a House or the recall of a House is not in the hands of the crown. In this case, we have before us a motion which leaves that matter to Her Majesty’s representative in this House. I protest that we cannot so lightly yield our privileges as members.

Mr. Speaker: I don’t know whether any other member would like to speak to the point of privilege. I think it’s a phraseology often used. In actual practice, it is the responsibility of the governing party and the government of the day to reconvene Parliament.

Mr. Renwick: You never know who that will be around here.

Mr. Speaker: Whether or not the wording of the motion was as the honourable member suggests, I don’t think there are any illusions in anybody’s mind as to who is going to reconvene this Parliament.

Mr. Renwick: Who is the government of the day?

Hon. Mr. Davis: I’ve missed you.

COST REDUCTIONS

Hon. Mr. Auld: Mr. Speaker, on April 25, 1978, the Treasurer (Mr. McKeough) announced an expenditure reduction program amounting to $73 million which included a saving of $35 million to be achieved through a decrease in the size of the civil service. I am able to report that good progress is being made on this staffing constraint program.

Prior to this latest move, the government had severely constrained the size of its work force. Therefore, it was obvious that the additional staff reductions would be very difficult to achieve. There is no more slack in the system to cut. Rather, the work force could only be reduced through the elimination of lower priority activities, through greater innovation and productivity and through organizational consolidation where possible.

Because of these considerations, the $35 million reduction target was distributed among the ministries and the ministries were asked to develop a plan for review by Management Board as to how they would meet their target. That process is now complete, with one exception. The Ministry of the Attorney General was assigned a target of $1.9 million. Great difficulty has been encountered in developing a method of making this cut without compromising the administration of justice in Ontario. Therefore, we have decided to conduct a more intensive review of the court administration system and its staffing standards before resolving this one case.

In developing their constraint plans, some ministries have identified expenditure reductions other than staff which could be made with a lesser negative impact on ministry service levels. Where Management Board was convinced that such savings were preferable and would continue into future years, the substitute savings were approved. For the information of the honourable members, I am distributing a detailed tabulation showing all of the expenditure reductions on an annual basis by ministry. You will note that the savings in personnel costs amount to $30.8 million, other savings total $3.5 million, and the situation in the Attorney General’s ministry is still unresolved. This means that by April 1, 1979, the government work-force will be reduced by the equivalent of almost $31 million per year with the possibility of further reductions in the Ministry of the Attorney General.

With the completion and approval of these staff reduction plans, the general recruitment freeze announced on April 25 of this year has been progressively lifted. This will allow individual ministries to fill key positions with a minimum of internal red tape. At the same time, we expect recruitment activity to proceed at a diminished pace, as most ministries will be reducing their staff in accordance with their specific constraint plans.

On several occasions, I have explained the new manpower control system now being used by the government. It is based on a comprehensive cost approach with the current size of the work force limited by a global salary and wage allocation to each ministry and future costs controlled by the classified structure ceiling. Within these limits, ministries can and should adjust their manpower mix to achieve maximum results in a changing environment. For example, a ministry could substitute two $15,000 a year employees for one $30,000 a year employee or, alternatively, use the money for several part-time employees. The objective would always be maximum results for limited dollars in relation to changing conditions and priorities.

The staff constraint plans previously described recognize the flexibility inherent in the new manpower control system. We can expect most ministries to change the mix of their staff reductions within the established limits as their plans culminate on April 1, 1979. Thus, it would be pointless to speculate on the number of individual positions that will be eliminated. However, I have no doubt that the 1979 budget statement will show a further substantial decrease in the size of the civil service. When related to an increasing work load as represented by the growing population of Ontario, I believe that this is a clear indication of increasing productivity in the civil service.

In addition to this latest staffing constraint, I must point out that the government has undertaken a series of measures designed to reduce the cost of the civil service. These include:

1. The 1975 budget which announced a staff complement reduction of 2.5 per cent. The savings were estimated at $15 million, and encompassed, at that time, 1,741 positions.

2. On July 7, 1975, the 1975 budget supplementary actions imposed a further cut of 1,500 complement positions in the internal administrative function.

3. The 1976 budget resulted in a further cut of 1,000 complement positions.

4. The 1977 budget provided for no increase in the government workforce.

5. On September 16, 1977, I announced a 2.7 per cent reduction in the salary and wages account for the balance of 1977-1978. On an annualized basis, this reduction would amount to about $35 million.

Besides reducing the size of the civil service, we are making sure that the compensation level as determined by job classifications remains under tight control. We will not permit upward classification creep, a process which gradually introduces more highly-paid positions without necessarily adding to the number of employees. Our record relative to senior management positions is a very typical example. Between January 1976 and August 1977 we achieved a net reduction of 55 executive positions, despite the requirements of a new ministry, Northern Affairs, and a new program initiative, children’s services. An additional superstructure reduction program was started in September 1977 that will yield an additional 25 positions.

Thus, the total cut in senior management, such as directors, executive directors and assistant deputy ministers, will be 80 positions. That is a decrease of 10 per cent in the number of positions that existed at the start of the program. According to the June 5 edition of the Toronto Globe and Mail, during that same time period, the number of senior executive positions in the federal civil service increased by 4.4 per cent.

While I am quite proud about our general record in controlling the government work force and, in particular, making a further reduction of $34 million, I must also point out that we are probably at the end of the line in this regard. We cannot maintain an effective civil service if we eliminate all external hiring. We especially need to attract some of the bright young people now entering the work force who can, with seasoning and experience, become the key senior civil servants of tomorrow. In addition, I am quite convinced that most if not all of our programs are now operating at a minimum staff level.

Thus, considering future capability and current service levels, any future staff cuts will have to be related to specific program reductions or eliminations. The potential for general staffing constraints has really been pretty close to being exhausted with this latest initiative.

Mr. Speaker, I have another brief statement in reply to questions 111 to 127 on the order paper.

On June 20, 1978, a total of 17 questions was tabled by the Leader of the Opposition as questions 111 to 127.

Mr. Martel: Is this a filibuster?

Mr. Cassidy: The minister has used up half the question period already.

Hon. Mr. Davis: We want the members opposite to be fully informed.

Mr. Cassidy: It never happens over here.

Hon. Mr. Auld: In reply to all these questions, I have these observations to make.

To begin with, I believe the government has already been most informative on this issue. My reply to question 45 on May 16, 1978, provided a great deal of information on the expenditure constraints during 1977-78.

[10:30]

Secondly, it would be quite difficult to correctly interpret and precisely answer the subject questions. When authorized funding is reduced, program managers respond with a number of austerity measures which are usually effective in the short term. Staff vacancies are not filled promptly, for instance, staff training courses are deferred, travel expenses are reduced and so on. Subsequently to tabulate all of these measures and assign a particular dollar value to them is a very great deal of work, would not be very precise and I fail to see the relevance of the whole exercise.

Lastly, it seems to me that the correct forum for an expenditure review of this nature is the public accounts committee or during the estimates review. Both options provide an opportunity to discuss expenditures and any changes that might have or will ‘be taking place. Since the procedures are less formal, the information exchange can be more effective.

CONDOMINIUM LEGISLATION

Mr. Philip: Mr. Speaker, I rise on a point of privilege. On Thursday, June 15, during the debate on Bill 103, I read into the record certain statements made by people from the Federation of Ontario Condominium Associations who had met with the Minister of Consumer and Commercial Relations on June 12. In an attempt to discredit these statements, the minister indicated that the other members of the federation who were at that meeting and whom I did not quote were supportive of Condominium Ontario and that the views presented were only the views of two out of 11 members of the federation executive who had met with him. I subsequently discovered that there were, in fact, at most seven members of the federation at that meeting, not 10 or -- as the minister indicated, a matter which the minister should well have been --

Mr. Speaker: That’s not a point of privilege. Would the honourable member point out to me what privilege of his has been abrogated as a result of that exchange?

Mr. Philip: The minister has indicated some information which was false, and I would like to give him an opportunity to correct the matter.

Mr. Speaker: No, it was the information that he gave as he saw it, and it’s the right of any member of this House to do that.

Mr. Martel: He can’t count, the poor boy.

Mr. Speaker: There can be an honest difference of opinion, but there is no point of privilege.

ORAL QUESTIONS

YOUTH EMPLOYMENT PROGRAM

Mr. S. Smith: Mr. Speaker, I will direct a question to the Premier in the absence of the Treasurer. I am sure the Premier is familiar with the report which the Treasurer tabled which was entitled Youth Employment and the Ontario Economy, and it’s a very serious problem which I am sure he and I agree must be addressed. I would make one very brief quote from that report: “Recognition of the problem of large numbers of new entrants in the absence of relative wage adjustments has led a growing number of countries to experiment with direct job subsidy schemes,” and it goes on to discuss some of the good points and some of the bad points about these schemes, which are similar to those which we have been suggesting in this party for some time.

What I want to know by way of my question is, will the government act upon this report? The conclusion is that despite some of the undesirable features of these direct job subsidy schemes such as we have recommended, it may be possible to link employment creation to an industrial growth strategy, and they recommend basically that as long as there’s a strategy and the thing is used properly, direct job subsidy is a reasonable way to get these young people into the work force and not just for the summer. Will the Premier act on this report according to the suggestions that have been made?

Hon. Mr. Davis: I think, Mr. Speaker, the report points out some of the pluses and minuses. I think the Treasurer, in tabling the report, was wishing to inform the members of the Legislature and members of the public of the experience elsewhere and our own experience with the program for the summer months. The government, in terms of employment, in terms of the economy, is always looking for responsible and reasonable ways to resolve some of the problems that we face.

I am certainly not in a position today to say to the Leader of the Opposition that we are going to embark at this point on some new program, but I think the Treasurer has pointed out, as I say, the positive aspects as experienced in some other places and some of the problems that also exist. I am sure the Leader of the Opposition understands that I can’t suggest today that we are going to embark upon some new program that might be described as a permanent one.

Mr. S. Smith: May I ask what the Premier does have in mind for what I would suggest is the number one problem we have in front of us, which is how we are going to accommodate the 200,000 young people every year who are coming out of our educational system and will be doing so until that population bulge goes through the system?

Surely the Premier knows as well as anyone else the serious social consequences of having these people unemployed. We have suggested a direct job subsidy; the report seems to say that on balance, carefully done, it is worth trying. Other countries have done it. Why is the Premier so hesitant to move on to this, and when can we expect some action for what is really an emergent and present problem?

Hon. Mr. Davis: We are aware of the problem, but I think there are other matters that have to be considered. The honourable member’s colleague was there for parts of the discussion -- it isn’t by any means a complete solution but I think it is related to it -- at the conference or discussion period that was held at Seneca with respect to the matching of employment opportunities to skills.

I think there was a recognition at that conference that while there are a number of young people coming into the labour force, there are certain occupations or trades where there is still a requirement for people. I think there has been a tendency, and this was expressed at the conference, for young people -- partially because of parental influence, partially because of our social structure, whatever way one may wish to describe it -- to tend to move to some occupations or professions where the job opportunities are not as great.

Some of the recommendations at that conference will be helpful to us -- when I say “us,” I mean to those responsible; this includes the educational institutions, the trade union movement, and government -- in that some of these young people can and should be encouraged to move into those areas where job opportunities quite obviously exist today and where the potential for them in the future in number terms may be somewhat greater.

I would also say, with respect, that while there are a number of matters that might be considered -- and this province has not been reluctant to take the initiative in some fields -- if there were to be a permanent program as exists in some western European countries, which quite obviously have a somewhat different structure, one really should anticipate this being done by way of a national program. I am not saying this means the provinces shouldn’t or cannot do it. I am just saying that if it were to happen, in my view -- and I think I am right in this -- it should be done on a national basis. If it weren’t done on a national basis, we could get into the difficulty that, if we were to embark upon such a program, would we put domicile in as a prerequisite of eligibility for the program? I think the Leader of the Opposition knows my views on that subject; I expressed them yesterday. I think we would all be reluctant to see that sort of thing emerge as being a precondition.

While I don’t question the validity of the concern of the Leader of the Opposition, I am just pointing out that the solutions aren’t quite that simplistic. I think a lot of things have to be considered. No one is debating the numbers coming into the labour force; I think, though, that there are other solutions, partial solutions, partial solutions, that have to be considered by all of us when we approach the problem.

Mr. Sweeney: Supplementary, Mr. Speaker: In the Treasurer’s report, he clearly indicates that he is dissatisfied with the distribution of funds to the two ministries of education with respect to job creation and job orientation. What does the Premier intend to do with respect to those two ministers and that particular comment of the Treasurer?

Hon. Mr. Davis: I think there has always been this ongoing discussion. The honourable member, who is an expert in this field himself, understands the traditional differences of opinion that have existed. Perhaps it is easy for someone who isn’t as directly involved to make that sort of observation. Perhaps the member wasn’t there for the Friday morning discussions when a number of people, including some from other than the university community suggested it would be unfortunate -- I think that was the phrase used -- to say to a person who wanted to pursue, shall we say, an academic career in honours history, that he should be precluded from doing that, and there was nothing wrong with a skilled tradesman having a degree in honours history.

I know that is a bit of a contradiction in the minds of some people, but I think we would all be reluctant to say there isn’t some benefit in terms of a general education -- and I use that word general rather than liberal education, which is the academic phrase, even though the person might not use that specific general education in their occupation. I think this is the area that has been discussed. It is not new, it is not different. There are those who would argue that there should be far greater emphasis on the technological courses and on the two-year programs at our community colleges. As one who debated with the former leader of the Liberal Party the whole concept of the community college and the decision by the government to really orient the community colleges to the technical, vocational, technological courses, rather than -- as I think I recall his suggestion of it being -- primarily a two-year entrance general arts program for admission ultimately to the universities, as the junior college system in some states of the Union, I think the wisdom of that decision is now perhaps becoming apparent to the former Leader of the opposition.

Mr. Nixon: The Premier is wrong in his assumption, but rather than interrupt his flow any more, we will let it go. He is absolutely wrong.

Mr. Speaker: Order. I think the question has been adequately answered.

Hon. Mr. Davis: This was the view shared by the Toronto Globe and Mail at the time, as a matter of fact.

Mr. Nixon: The then Minister of Education would not even let the education committee discuss it.

Mr. Speaker: A new question.

Hon. Mr. Davis: That’s not right.

Mr. Nixon: The Premier just presented us with a package based on Hawaii and Florida, as I recall.

Hon. Mr. Davis: On a point of personal privilege: based on California, Florida and New York state, but not Hawaii.

Mr. MacDonald: No personal privilege, it is a difference of opinion.

Hon. Mr. Davis: Mr. Speaker, I never went to Hawaii -- until a year ago. When I did go --

Mr. Speaker: The Leader of the Opposition with a new question.

CITY STATUS FOR BOROUGHS

Mr. S. Smith: I will address another question to the Premier, again in the absence of the Treasurer. In view of the fact that the mayor of North York and the mayor of Scarborough have both recently written to the Treasurer reiterating their request that their present boroughs be granted city status; given the fact that the Treasurer has said that he will not consider this unless it is part of a much larger package to do with Metropolitan Toronto as outlined in his white paper; and now that the white paper has in fact been shelved and the proposals have been shelved is the Premier prepared to ask the Treasurer to use the authority he has under section 148(a) of the Municipality of Metropolitan Toronto Act to grant city status for the boroughs of North York and Scarborough who have requested it and for that matter for the remaining boroughs who may desire it?

Hon. Mr. Davis: Mr. Speaker, I understand the Leader of the Opposition has introduced a private bill related to this matter. I haven’t the dates of the Treasurer’s reply to the mayor of North York or the mayor of Scarborough. I think it was really anticipated that if legislation had been introduced in the past week or so, and it was obvious that no consensus had been achieved on some issues, that probably that matter would have been dealt with.

Mr. Speaker, I am a very reasonable, flexible individual; I have had this request made to me, I am not sure whether it was by the mayor of Scarborough or not, but I certainly have by the mayor of North York on previous occasions. I have never said it will never happen. I am quite prepared to take a look at this in conjunction with my colleague, the Treasurer, but the Leader of the Opposition will understand that if I cannot give a commitment on this today, he will not press for some answer before 12 noon on a particular date.

Mr. S. Smith: By way of a brief supplementary, accepting that the Premier may want a little time to consider the matter, may I ask the Premier if he would consult with the Treasurer in view of the intention of North York, for one, to introduce some changes in terms of civic buildings, crests, stationery and so on, all of which could amount to some considerable expense, if there is going to be a title change in the near future? And, similarly, since the whole package has now been shelved at the request of the government, could the government indicate any reason why it would not proceed with something as simple and straightforward as this request?

[10:45]

Hon. Mr. Davis: Mr. Speaker, I think that if North York is at that stage in its administrative procedures where large new orders for letterhead and other matters are being made part of the budget, if there is a significant expenditure involved I will chat with the Treasurer and make sure the mayor of North York is given a decision. That much of a commitment I can give to the Leader of the Opposition.

AUTO PACT

Mr. Cassidy: I have a question to the Premier relating to the discussions he has been holding over the course of the last three or three and a half months with the presidents of the major automobile companies, with people from the parts industries and most recently with the United Automobile Workers Canadian district. Can the Premier now report to the House what specific steps the automobile companies are intending to take in order to give Ontario and Canada a fair share of automobile production, investment, employment, research and development, and of production in the parts sector of that industry?

Hon. Mr. Davis: The honourable member’s question is somewhat fortuitous. I was going to ask permission of the House to revert to statements. There will be two statements. Mine is very brief, then the Minister of Industry and Tourism (Mr. Rhodes) wishes to make some comments. I can either ask permission of the House to revert for these brief statements or I can answer the question, which would really be just reading my statement.

Mr. Cassidy: On a point of order, we would like to revert to statements.

Mr. Speaker: Do we have agreement to revert to statements? Agreed.

Hon. Mr. Davis: I know the member for London Centre wants me to be brief. I just wish he would exercise the same self-discipline on himself.

Mr. Peterson: Not now, all the time.

Hon. Mr. Davis: That’s his third new suit this week.

Mr. Laughren: Stop playing games.

Mr. Havrot: You guys are the greatest game players in the world.

Hon. Mr. Davis: I would only say to the member for Nickel Belt that unlike his party we don’t play games over here, but we don’t take ourselves as seriously as they do either. We take our jobs seriously but not ourselves; something they might learn.

Mr. Speaker: Could the Premier begin his statement?

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

Mr. Laughren: You take the Speaker seriously sometimes.

Hon. Mr. Davis: On a number of occasions during this session questions have been raised and points of view expressed about the state of the auto industry in Canada and, in particular, about the effects of the Canada-US auto pact on that industry. During those exchanges I indicated that cabinet members and civil servants were involved in a series of discussions with spokesmen from the auto and auto parts manufacturers as well as representatives of the auto workers. I also indicated I would be prepared to make a statement to the House when these discussions were concluded.

Our last meeting was held on Monday of this week. I shall, therefore, be tabling today -- and I will do so immediately -- for the information of all members a background paper on the automotive products industry, which contains not only a summary of the information acquired at the discussions held to date but also expressions of our attitudes and concerns about future prospects and developments.

Members will be aware that also within this week the federal government has announced an extensive study of the auto industry and the auto pact to be undertaken by Mr. Simon Reisman, former Deputy Minister of Finance in Ottawa. This new development will undoubtedly lead to further meetings and discussions and, hopefully, decisions and action. Needless to say, Mr. Speaker, I shall ensure that the House is kept informed of these matters.

Finally, as I mentioned, I should note that the Minister of Industry and Tourism has been involved in a series of ongoing discussions with his counterpart in the federal government. I believe, with the acceptance of the members of this House, if the statement period could be extended the Minister of Industry and Tourism should make his statement now; and then I’ll endeavour to answer whatever questions the leader of the New Democratic Party may have. He may wish to direct one of them to the Minister of Industry and Tourism.

PLANT LOCATION INCENTIVES

Hon. Mr. Rhodes: I’m not aware of whether the copies of this statement have been delivered.

Mr. Cassidy: Yours has, but not the Premier’s.

Hon. Mr. Rhodes: Fine. On the matter of government incentives for new investment in the automotive industry, I regret to inform this House that discussions with Ottawa have resulted in no new proposals. As recently as this past Wednesday, I was hopeful that a joint federal-provincial approach could be developed to allow us to influence the location of a major new automotive project which would have resulted in 2,600 new jobs in this province. However, Ottawa seems to have become so preoccupied with issues other than those affecting the economic well-being of this country --

Mr. Peterson: You are getting down in the gutter with the rest. This is silly. Get your sights up. Who wrote this, the Premier?

Hon. Mr. Rhodes: -- that the federal government is incapable of determining, let alone taking, the necessary action.

Hon. Mr. Bernier: Listen to your friends in Ottawa.

Mr. Peterson: You are getting cheap.

Hon. Mr. Davis: You should know what they are up to.

Hon. Mr. Rhodes: Late last February the Honourable Jack Horner, Minister of Industry, Trade and Commerce, contacted me to ask whether Ontario would participate on a 75 per cent federal-25 per cent provincial basis in offering a $30-million cash grant to the Ford Motor Company of Canada to locate a $500-million engine plant in this province. He told me that the $30 million was estimated by Ford to be the difference in the investment costs in locating this new facility in Ontario as opposed to a northern United States state.

At the same time, I was informed that the federal Department of Regional Economic Expansion, together with an agency of the Quebec government, would be offering approximately $80 million on about the same 75-25 basis to General Motors of Canada to locate a $400-million aluminum casting facility in Quebec.

At that point in time, this government had not formulated a policy on Ontario’s role in major incentive proposals and, consequently, a response to Mr. Horner was deferred. While the matter was being considered, it was learned that Ottawa had gone ahead and made a $30-million offer to Ford without Ontario participation. Since an immediate Ontario response was no longer necessary, we decided to take a broader and deeper look at the Canadian automotive industry and future investment prospects. Studies in both my ministry and TEIGA were initiated and meetings with the major firms, the APMA and the United Auto Workers were convened by the Premier. At these meetings, several firms told us of substantial and broad-reaching incentives being offered by most northern states in the United States to attract new investment.

The APMA presented its case for government assistance at this crucial time in the industry’s development. Virtually all of those consulted deplored the use of subsidies to lure new investment, but at the same time confirmed that incentives were an important factor determining the location of a new plant.

While these consultations were in progress, officials from the federal departments of Industry, Trade and Commerce and Finance met on May 26 with Ontario officials to discuss the main features of an automotive investment incentive program then under consideration in Ottawa. The program being contemplated was specifically designed for non-DREE designated areas of the country and would provide assistance amounting to one-third to one-half of that available under DREE. In other words, the program was designed to maintain a substantial regional development incentive, while at the same time providing a measure of support for automotive investment location in regions such as southern Ontario. It was suggested that provincial participation in the program might follow the 75-25 per cent formula proposed in the Ford offer.

As a result of our studies and meetings with the industry, we had come to the view that some Ontario participation in automotive investment incentive schemes was necessary, particularly in view of the importance and timing of the investment programs presently being considered by the industry. Our principal concern, however, related not to competing with Ohio, Michigan or New York, but with our sister provinces. It would, in our view, have been counter-productive for us to get into a bidding war with other provinces. Thus, we concluded that a federal program with provincial participation would be preferable to separate competing provincial programs.

On June 6 the Treasurer and I met with Messrs. Chretien and Horner in Ottawa to discuss automotive investment incentives and in particular, we thought, the federal proposal which had been discussed among officials. Much to our surprise, the federal ministers made no mention of this proposed program. In any event, we informed Messrs. Chretien and Homer that if a federal automotive investment incentive program were developed, it would have Ontario’s support and participation.

Last Friday, June 16, senior executives of Ford of Canada met with me to inform me of a new development in the planning of the $500-million engine plant and to request Ontario’s support for increased assistance. Ford was now planning to expand an existing engine facility rather than build a totally new facility and the investment cost differential had increased to $75 million, that differential being between the expansion of an existing plant in the United States as opposed to a new facility in Ontario.

We were told that if the Canadian incentive offer could be increased from $30 million to $75 million there was a good chance that the facility could come to Ontario. We were told that Ford executives had met the previous Wednesday, June 14, with ministers in Ottawa and had made the same request for increased assistance. The Ford representatives were told that Ottawa support would depend on Ontario’s reaction.

The Ford request was considered by cabinet here on Wednesday, and it was decided to inform Ottawa as follows -- this is quoted from the Telex sent to Mr. Horner:

“The position of the Ontario government with respect to incentives for new investment in the automobile industry in Canada is as follows:

“1. That Ontario will participate with the federal government on a 25 per cent provincial/75 per cent federal basis in an investment incentive offer of $75 million to Ford of Canada for the proposed V-6 engine plant in Ontario;

“2. That this type of offer not be limited to Ford of Canada but be available on a comparable basis for other employment-creating automotive investment projects in Ontario; and

“3. That Ontario participation be limited at this time to a total of $50 million.”

Mr. Deans: God, you’d wonder that Ford couldn’t afford these things by themselves.

Hon. Mr. Rhodes: Yesterday afternoon, Mr. Horner telephoned to advise me that the federal government would increase its offer to Ford to locate in southern Ontario only if the federal contribution were matched on a one-for-one basis by Ontario.

Mr. Kerrio: They got that ratio from Bob Welch.

Mr. Deans: It’s truly sad when we’ve got to subsidize Ford Motor Company.

Hon. Mr. Rhodes: In other words, the federal government would increase its contribution from $30 million to $37.5 million only if Ontario would also contribute $37.5 million. It is no longer a three-for-one proposition; it is now one-for-one.

The main reason given for the apparent change in federal attitude was concern over the size of the federal grant in relation to normal DREE assistance.

At least one other province apparently felt that it would no longer have a sizeable enough additional subsidy available under DREE to entice auto firms to locate outside of Ontario.

In the case of Ford, it is not a question of Ontario versus another Canadian province; it is Ontario -- Canada -- versus a US state. I am very much afraid that the Ford plant will now be lost. This government remains prepared to participate with the federal government on a 25 per cent basis in any program designed to assist new automotive investment in Ontario, however large or small the project.

Mr. Martel: We should start our own industry.

An hon. member: We should buy $75 million worth of their state.

Hon. Mr. Rhodes: If Ottawa is not ready to go forward on that basis, Ontario on its own must use every means within its power to ensure that in future prospective new automotive investments, and particularly those of the size and importance of the Ford engine plant, are given every opportunity and encouragement to locate in this province.

Mr. Deans: Boy, do we need a reassessment of the way things are going.

PLANT LOCATION INCENTIVES

Mr. Cassidy: I’m rather bowled over by this, Mr. Speaker, and I must say I deplore the fact that the Premier apparently intended to read this into the record after the last question period for three months rather than before.

Hon. Mr. Davis: Mr. Speaker, on a point of privilege, that is totally untrue and unfair.

Hon. Mr. Welch: That is not true.

Hon. Mr. Grossman: He said the opposite.

Hon. Mr. Davis: The final meeting was held with the UAW on Monday. The discussions with respect to the issue mentioned by the Minister of Industry and Tourism had been going on until about an hour ago, with my own involvement late yesterday afternoon. This document was prepared as rapidly as possible. To suggest that this has been delayed for two or three weeks, or two or three months, is just totally erroneous.

Mr. Bradley: Wrong again.

Hon. Mr. Davis: He suggests we were waiting until after the question period. We were working on this to have it here at 10 o’clock. I told our House leader that I was sure the members, knowing their interest, would not object to reopening the period for statements so that it could be made this morning and the honourable member would have an opportunity to discuss it. In fairness, we couldn’t have done much more to expedite it.

Mr. Foulds: Cease and desist.

Some hon. members: Apologize.

Hon. Mr. Welch: His editorial comments always get him in trouble.

Mr. Cassidy: Mr. Speaker, now that that point of order is out of the way, I would like to ask the Premier, in view of the fact that the Ford Motor Company is seeking to hold Canada and Ontario to ransom for this particular plant, will the government table all of the information and studies in order to confirm or not to confirm Ford Motor’s contention that that rich company can only come into Canada on the basis of the kind of subsidies that they are seeking, in particular view of the fact that the Treasury’s own figures have indicated that our corporation tax in this province, and a number of other costs that Ford Motor would have to bear, are lower and not higher than in those competing US jurisdictions?

Hon. Mr. Davis: Mr. Speaker, I am intrigued by what appears to be the position of the leader of the New Democratic Party. I must confess that it wasn’t clearly enunciated to the House, but in some exchanges we have had here -- and I think I overheard some of his members -- none of us want to get into the incentive business.

Mr. Deans: That’s right.

Mr. Mancini: That’s what he said.

Hon. Mr. Davis: I think it was apparent to us that in the discussions --

[11:00]

Mr. Mancini: That’s what he said in Windsor.

Hon. Mr. Davis: -- if it became a case of either it happened or didn’t, I sense something other than total rejection by some members opposite. They can check Hansard. I may be totally wrong and, if so, I will apologize, but I don’t think I am.

Mr. Foulds: Just table the document.

Hon. B. Stephenson: The studies have been tabled.

Hon. Mr. Davis: I would say it is not a question of producing studies. Check Hansard. I stand to be corrected. I have been wrong before and I shall be wrong again, but I am sometimes right. I am not here to explain or defend the Ford Motor Company of Canada. I should point out to the leader of the New Democratic Party, fortunately, or unfortunately -- in this case, in my view, unfortunately -- the decision on this particular investment will not be made by Ford of Canada. The decision will be made by Ford -- whatever its title is --

Mr. Deans: Doesn’t that tell you something about our branch plant economy?

Mr. Swart: It’s an international cartel that is involved.

Hon. Mr. Davis: That’s fine. Go ahead. You can interject all you want. If you want to know what I know about it, that’s fine. If you don’t, then I’ll sit down. It is as simple as that. I am trying to help as much as I can in telling members what the situation is.

What we found in the past short period of time, as the Minister of Industry and Tourism mentioned, was that the government of Canada on its own had offered Ford Canada $30 million.

One can argue whether they should or should not have. It was a judgement they made. There have been discussions about provincial participation. There is no question there is an offer on the table in some respects for General Motors under the DREE proposal, for a plant not too far distant from the city of Montreal, which we find just a shade difficult. One could understand it in some other geographic areas of the province of Quebec, but locating it around the city of Montreal is not as easy to explain. That is in limbo. I can’t inform the honourable members just what is happening.

Mr. Foulds: Answer the question.

Hon. Mr. Davis: With respect to Ford -- and members can debate the figures -- Ford has been saying to the government of Canada and saying to the government of this province within the past two to three weeks the decision will probably be as to whether it be a totally new plant or the extension to an existing facility it presently runs in one of the neighbouring states. The differential in terms of their capital costs for either the extension or the creation of a new facility in the province of Ontario is estimated to be in the neighbourhood of $75 million.

Mr. MacDonald: Do you believe that?

Hon. Mr. Davis: The member for York South asks do I believe it. I can’t get up in this House and say I am an expert on construction costs.

Mr. MacDonald: Get your experts.

Mr. Speaker: Just ignore the interjections, please.

Hon. Mr. Davis: I am relatively satisfied that the head of Ford Canada, with whom the member may not agree and may not like -- my guess is he probably doesn’t even know him --

Mr. Deans: I know him.

Mr. MacDonald: I know that the Premier knows him.

Hon. Mr. Davis: -- is anxious to get whatever capital investment he can in this country. I don’t believe he is coming in to con the government of Canada or the government of Ontario.

Mr. MacDonald: Perhaps you are too easily persuaded.

Hon. Mr. Davis: One can argue whether Ford generally has met the obligations under the pact, but I am one of those who believes that Mr. Bennett is making a genuine effort to get this facility. He comes in and says their best estimates indicate that in terms of construction costs, and in terms of those other capital costs that will be required, whether it is a new plant or an extension, the differential is in the neighbourhood of $75 million. I would point out to the leader of the New Democratic Party this does not take into account any incentives from a particular state where they have given incentives in the past. We don’t know whether they will give them again or not. This request from Ford Canada was on the basis of their actual differential in terms of physical location here or in the United States.

We are reluctant. We met with the UAW. I think it is fair to state -- and I don’t think they mind being quoted -- that they are not in support of an incentive program. I guess philosophically the members opposite in the Liberal Party might not be enthusiastic. We are not enthusiastic. The New Democratic Party isn’t enthusiastic because it is the wrong kind of incentive program.

I am the first to say to them that I don’t think any of the major automobile companies need this sort of assistance. I don’t think they need it.

Mr. Deans: That’s absolutely right, but you keep giving it to them and they keep coming back.

Hon. Mr. Davis: That’s fine. Our responsibility here as a government, knowing they don’t need it --

Mr. Deans: It’s robbery.

Hon. Mr. Davis: I am not going to go so far as the member.

Mr. Deans: It is.

Hon. Mr. Davis: That’s fine. He can say it’s robbery. He can say we shouldn’t do it.

Mr. Deans: It is.

Hon. Mr. Davis: The chances are with the change that the Minister of Industry, Trade and Commerce in Ottawa has now communicated to us, the opportunities on this particular facility appear to have diminished. He can say it’s wrong.

Mr. Deans: It is.

Hon. Mr. Davis: Our responsibility, nonetheless, is to see what we can do to create jobs.

Mr. Deans: As long as you give in to it they will keep coming back.

Mr. Speaker: Order. Order.

Hon. Mr. Davis: That is a responsibility we have. It is fine for you to say, but what we are faced with is fairly significant competition from other states of the union. We are faced with competition --

Mr. Deans: As long as you are going to enter into that kind of nonsense, you’ll always be responsible.

Hon. Mr. Davis: That’s fine. I understand --

Mr. Speaker: Order. The answer has developed into a statement and response to interjections. I will hear a supplementary.

Mr. di Santo: Supplementary, Mr. Speaker.

Mr. Cassidy: Supplementary.

Mr. Speaker: The honourable member for Ottawa Centre I think has just had an original question. I don’t think he has had a supplementary yet.

Mr. Cassidy: Thank you, Mr. Speaker. I want to say that I think it is time to take the gloves off with the companies --

Mr. Speaker: Question.

Mr. Cassidy: -- which are among the richest, most powerful --

Mr. Speaker: Question.

Mr. Cassidy: -- in the continent coming with their begging bowls to the Ontario government.

Interjections.

Mr. Cassidy: Has the Ontario government carried out any studies about those comparative costs in order to measure Ford’s claims? Has it analysed figures which have been given to it by the Ford Motor Company? If so, will the Premier make those figures public in order to show that is an incredible claim they are making and that it is simply blackmail by the Ford Motor Company to try to get $75 million from the governments of Canada and of Ontario?

Interjections.

Hon. Mr. Davis: I really think the language of the leader of the New Democratic Party is very inappropriate.

Mr. Martel: You free enterprisers have been giving away the store for years.

Hon. Mr. Welch: Check Hansard.

Hon. Mr. Davis: What I have tried to explain to the honourable member is that as a government we are not enthused about incentives. I said this long before he did, as a matter of fact. In fact, I was surprised at some of the observations coming from some of his colleagues. We made that position clear months ago. That point of view has not changed. Members opposite may not care about job opportunities but we have a responsibility. To suggest that this is a case of blackmail is just totally irresponsible.

Hon. Mr. Bennett: That’s right.

Hon. Mr. Davis: Ford Canada -- and I will say for the president that I can disagree with him on some issues, we can disagree on figures, we can disagree perhaps on Ford’s commitment or the way the figures work out with respect to the auto pact generally, we can disagree on all of those things -- we agree on some -- but one thing I am not prepared to let go by is a suggestion that the head of Ford Canada is not anxious and making every effort to locate this facility in Canada.

Mr. Lawlor: He’s an employee.

Hon. Mr. Davis: He is a Canadian. He is faced with a board south of the line which will be making a judgement based on economic considerations. That is part of their responsibility. That decision may relate to a cost differential without incentives from any state of the union, the differential being in the neighbourhood of $75 million.

Mr. Warner: The auto pact is pretty useless, isn’t it?

Hon. Mr. Davis: Of course we have assessed that $75 million. I am not in a position, nor is the Minister of Industry and Tourism in a position, to say that figure is right down to the last decimal point. I am not. I am relatively confident that it is reasonably close.

Mr. Cassidy: Then table the figures.

Hon. Mr. Davis: I think we are talking about a fair amount of money if Ford Canada is able to go to their head office and say, “The cost in Canada in terms of the development of the facility is now roughly equivalent to that which we would face in the United States.”

That happens to be the issue. The government of Canada in its wisdom has already committed itself to $30 million. The problem we face in this is that we felt it was to have been a three for one. Horner now says roughly 50-50. We are insisting as well -- I would hope the members opposite who happen to represent the Niagara Peninsula understand this -- that this should be available to any automotive development, if this is to be the policy, anywhere in this country. I am in favour of regional development. I understand the differences. I know that there are regional disparities, but I think there is a certain degree of equity involved in this situation particularly when the potential for job loss also may exist in the peninsula.

That’s why paragraph two was in the letter to Mr. Horner yesterday. We wanted to make it clear -- and I hope those people opposite understand and appreciate it -- that if this is to happen that opportunity is to be available to the St. Catharines area, GM or anyone else. Those people opposite haven’t done this. We are attempting to resolve it in a way that is equitable for everyone.

Mr. Martel: You’ve given the resources away; now they want the cash.

Mr. Speaker: Order.

Mr. Martel: You’ve got nothing else to give them, so you give them cash.

Mr. Speaker: Order. You’re just wasting the time of the question period.

Hon. Mr. Davis: What would you do?

Mr. Kerrio: Now you praise the UAW.

Hon. Mr. Davis: Why don’t you people just say you are totally opposed? We’ll understand. We don’t like it either.

Mr. S. Smith: Given what I consider the gravity of this situation; given the fact that what was portrayed to us as a decision --

Mr. Germa: Question.

Some hon. members: Question, question.

Mr. Hennessy: Tell them, Stuart, tell them.

Mr. Havrot: Fight them.

Mr. S. Smith: -- given the fact that what was apparently a difficult decision between whether to subsidize or not was resolved first of all, according to the statement, unilaterally, by the federal government who made the $30 million offer --

Mr. Germa: Question.

Mr. S. Smith: -- and then the ante was apparently upped by the Ford company -- once the game was entered into, they then raised the stakes; then given the fact that this government seems to have decided that it’s a game that, reluctant as it is, obviously -- and I agree with you -- it has decided it’s a game it had to enter into --

Mr. Germa: Question.

Mr. S. Smith: -- and now given the fact that there seems to be a problem with regard to the interpretation of DREE and the inter-provincial rivalries -- not in the Ford case but in the GM case --

Hon. Mr. Davis: That is not what I said occurred --

Mr. S. Smith: -- which is that once we start on this slippery slope towards allowing corporations to make these decisions to locate in our country or not, based strictly on their head office preferences due to financial situations rather than on the market --

Mr. Speaker: I still haven’t heard a question.

Mr. Foulds: And it’s been one minute and 15 seconds.

Mr. S. Smith: -- rather than on any obligation, would the Premier consider that this is a matter of very great urgency and importance and assist us in some manner to act in concert?

Mr. Germa: Question, question.

Mr. S. Smith: For instance, would he consider some way we can deal with this over the summer? Would he be willing to meet with our Treasury and industry critics in both parties, brief us on what he knows about the matter, discuss the implications with us? Because we should act in concert if at all possible on this very serious matter.

Mr. MacDonald: Question. What are you doing?

Mr. Makarchuk: He has got a problem. Harold Greer didn’t get a chance to work on it.

Mr. S. Smith: Can we expect therefore that the Premier will share information with us to enable us to support whatever stand the government eventually feels it is necessary to take?

Hon. Mr. Davis: I can assure the honourable member that we will share to the extent possible whatever information we have. We’re in the process of doing it. We’re sharing it with the House within hours after we ourselves have received it. To suggest that over the summer there could be some meetings or action in concert -- we’re faced with the immediate situation of Ford. Ford will know what is the position of the government of Canada and ourselves. That decision will probably be made fairly soon.

There is no question in my view -- and I shouldn’t be defending the government of Canada, much as the member for London Centre would like me to -- I sense they are reluctant to get into this sort of situation. After one or two discussions, my impression is that this is really the reason for the appointment of Mr. Reisman. I don’t think there is any question that is the approach they wish to take.

Mr. Cassidy: He was appointed to sell the store completely.

Hon. Mr. Davis: Listen, the honourable member can be cynical about it; we can question it. But I have to tell the member that I think -- and I’m only giving an impression -- that the government of Canada is taking this route as a possible alternative to getting into this subsidy business. If Simon Reisman comes to us and says, “What are your views and what information do you have?” et cetera, maybe the leader of the New Democratic Party won’t want us to but I’ll tell him right now that we will present our views, we will present our information and we will make a very strong case for what we think should be done.

Mr. Cassidy: So will we.

Hon. Mr. Davis: I would say to the Leader of the Opposition that some of his caucus members are interested in the GM situation. My information is that that is somewhat in limbo at this precise moment. I can’t tell the Leader of the Opposition just what may or may not happen.

Hon. Mr. Welch: The same rules should apply for St. Catharines as apply for Montreal -- the same rules for everyone.

Mr. Deans: Don’t you realize that it is never-ending?

Hon. Mr. Davis: This is what we attempted to do in our reply. The GM thing is on the table because of DREE; it’s there. I’m not going to quarrel with incentives related to regional disparities but we’re talking about pretty significant issues.

[11:15]

I would be quite prepared to share whatever I can. I can’t share that which is given to me in confidence, nor can the minister. We’re dealing with a pretty complex issue and one where I just re-emphasize -- it’s been stated by the minister, myself and the Treasurer on a number of occasions -- that we think it is not good business to get into it. But at the same time, Mr. Speaker --

Mr. Deans: I agree.

Hon. Mr. Davis: All right.

Mr. Deans: Then what does the government do?

Hon. Mr. Davis: We’re faced with it.

Mr. MacDonald: The government has been involved in it since Confederation.

Hon. Mr. Welch: If we sit back and do nothing we get criticized by members opposite as it is.

Mr. Deans: You don’t have to sit back and do nothing.

Hon. Mr. Bennett: Ask Pennsylvania and Ohio what they’ve been doing. They get it all, and you complain all day and maybe all night.

Mr. Speaker: Order. We have expended 35 minutes of question period and we’re not finished the third question yet. I’m sure there are many important questions that honourable members would like to place, since this is the last day. I have two answers of some urgency from the Ministry of Health. I would implore all members, whether they’re asking the question or answering it to keep their answers or their remarks brief if we’re going to share equitably the 25 minutes that are left in question period.

A supplementary, the member for Nickel Belt.

Mr. Laughren: A supplementary to the Premier: Does the Premier fully comprehend how dearly it has cost us to have his Treasurer taking one position and his Minister of Industry and Tourism another position on this matter of incentives? Does he understand, as well, that the real issue here is fair share; particularly in view of the fact that the Canadian share of the North American retail market is around nine per cent, whereas our share of value added is 6.9 per cent, employment 8.4 per cent, investment 5.4 per cent and we have virtually no share of the research and development funds? Does the Premier fully comprehend now what his cabinet has cost us by allowing the federal government to unilaterally take a position without full consultation because of a split cabinet?

Mr. Havrot: Nonsense.

Hon. B. Stephenson: Hogwash.

Hon. Mr. Davis: Mr. Speaker, the honourable member on occasion, makes relevant points. That really is one of the silliest he has made in this House in a long, long time; it really is.

Mr. MacDonald: That is a matter of opinion, not fact.

Mr. Breaugh: If that is such a silly point, where is the Treasurer?

An hon. member: He’s not here.

Mr. Warner: No wonder he is not here.

Hon. Mr. Davis: Whatever positions this government has taken have not in any way prejudiced the potential of capital investment by the automotive industry, whether it be the “big four” or the parts industry. Nothing we have done has prejudiced that. Everything we have done, Mr. Speaker, has been directed towards getting a portion of that investment --

Mr. Deans: For years the government has done nothing.

Hon. Mr. Davis: -- and I am relatively confident that over the period, we will get it. What we’re debating now is really one specific capital plant location; and the member for Nickel Belt (Mr. Laughren) can say he disagrees; I understand it.

Mr. Cooke: What is the auto pact about?

Mr. Breaugh: Where is it?

Hon. Mr. Davis: We don’t like it. It was done on the basis that if we didn’t participate, the potential was that this roughly $500 million investment -- 2,600 jobs -- would be located geographically somewhere else, that was a reality. I know members opposite don’t like to face realities but we had to. The government of Canada had put $30 million on the table; and in our wisdom -- and members can question the wisdom -- we said for this particular situation, we would go three for one but as a condition of that, because of the potential of General Motors and others, it would have to apply to others as well.

Mr. Cooke: What is the auto pact all about?

Hon. Mr. Davis: Members may disagree with it if they want, but don’t start talking about our motivation, don’t start talking about any division of opinions because that is totally irrelevant and totally erroneous.

Mr. Laughren: Your government has never had its act together.

Hon. Mr. Rhodes: You guys are sucking wind and you know it.

Mr. Laughren: There is the problem right there.

Hon. Mr. Rhodes: You are gasping for air; you are a dying breed, socialism is dead.

Mr. Speaker: The member for London Centre.

Mr. Peterson: Mr. Speaker, I have a three-part supplementary which I think is important to this question. I would like to know from the Premier what other options, what other arrows and a quiver of possibilities he could have used, as an executive of this government, to put pressure on the auto companies without getting into the subsidy game, knowing full well all the risks of that? I would like to know what other options he used, what kind of moral situation and what other kind of legislative devices he contemplated using?

Secondly, I want to know in what form that money is going? Is that going to be strictly in cash or in a provision of services?

Thirdly, I’d like to know the very specific and direct commitment from the auto companies, not only in terms of jobs but also payroll, taxes, balance of payments; effect on the auto pact and, specifically in economic and human terms, what is it going to do for this province?

Hon. Mr. Davis: I recognize the business or accountant’s perspective to this particular question. I must confess I can’t answer it all. I would suggest that if the honourable member, who has greater ability in this field, were to answer this question himself for himself he would then maybe share it with me.

Mr. Peterson: I would know before I made a decision.

Hon. Mr. Davis: Dealing with the third part of the member’s supplementary, we are dealing with one particular plant where the estimated capital investment is in the neighborhood of $500 million. The estimated employment level is 2,600 workers. If the province’s participation were one quarter of $75 million, which is around $18 million, I would suggest if the honourable member would calculate the retail tax on construction materials for a $500 million investment -- he might be able to calculate how much of it is construction and how much is equipment -- if the member were to calculate the provincial sales tax on construction material, if he were to calculate the economic benefits of having X hundred employees involved in the construction of that $500 million facility, if he were to calculate the payroll for 2,600 employees over a minimum five-year basis at X number of dollars per week and what the retail sales tax and the income tax would be, my guess -- and I am only guessing -- is that the net revenues to the economy of Ontario, if that’s how he is looking at it, would substantially exceed $18.5 million.

Mr. M. Davidson: What about the rest of the question?

Hon. Mr. Davis: That was the third part of the question.

Mr. Makarchuk: Supplementary: In view of the fact that discussions are going on right now regarding the establishment of an engine plant for the agricultural equipment field, would the Premier consider giving the three-for-one type of assistance to the agricultural implement industry, should they plan to establish an engine plant in Ontario?

Hon. Mr. Davis: This is where we are very reluctant to get into the question of subsidies. This is the problem I have raised publicly. You get into it in the automotive industry and you can perhaps develop this rationale. What the honourable member is asking is does this incentive then apply whether it’s agricultural equipment or anything else. The answer to that obviously has to be no. This is one of the reasons we don’t want to get into it.

I am not going to try to fool anyone. I never have. There is a $30 million bill on the table. There are 2,600 jobs and there is the possibility of locating this plant. There is GM, where we want to be in a position to compete. We don’t want any advantages over the province of Quebec. We don’t want them to have any for us. We want an equitable sort of approach to it. Those two are there, particularly Ford. That’s fine.

Members can say we shouldn’t have said to Mr. Horner that we will go three for one, I understand that. I have got to tell the member that I have a few people who are members of the UAW who may agree in philosophical terms with that. They also might like a job. That’s the sort of thing we have to decide. That’s where it becomes a little more difficult; that’s why in opposition the answers sometimes appear to be very simplistic, and I appreciate that. We also have the human factor as well as the economic factors to consider.

Mr. Cassidy: I want to return to the same subject with the Premier. I want to ask a question of the Premier which arises out of both what he has said, and also the background paper which he has tabled in the House which I have had a chance to look at briefly.

The Premier’s statement indicates that over the next 18 to 24 months the automobile companies will be making decisions effecting about $60 billion worth of investments, and therefore of jobs. I want to know whether the Premier and the government endorse the concept, as our party does, that this province and this country should have a fair share of production and of jobs in the automobile industry; that there should not be a trade deficit and that we should have a fair share proportionate to our share of consumption of North American cars and trucks. Is that the government’s position as well? If so, what specific steps is he intending to take in order to make that a reality?

Mr. Cooke: Why should we have to pay for it?

Hon. Mr. Davis: I wonder where the honourable member has been for the past several months?

Mr. Peterson: Roller skating.

Hon. Mr. Davis: We have been saying these things. We have been working to attempt to resolve these things. We have been meeting with the companies.

Mr. Warner: You have a very bad track record with nothing to show for it.

Hon. Mr. Davis: We are the ones who initiated the pressure on the government of Canada.

Mr. McClellan: You have nothing to show for it.

Hon. Mr. Davis: The leader of the New Democratic Party knows that the ultimate resolution to this, because of the international nature of it, does lie with the government of Canada.

Mr. Laughren: They had two different positions, too.

Hon. Mr. Davis: It was this government that prodded them into taking some sort of action. Of course, we are seeking -- I don’t know whether the term “fair share” is the right terminology; I don’t get hung up on semantics like the leader of the New Democratic Party. We want what is right for this country; I want what is right for this province. I have made a particular pitch to the automotive companies in terms of research and development, because I don’t think we have had a fair share or any share. They know that. I have made it abundantly clear.

Mr. Laughren: Get your ministers together then.

Hon. Mr. Davis: Before I sit down, I just wish that the honourable leader of the New Democratic Party would look at Hansard of Friday, March 8, at his own observation and that of the member for Hamilton East (Mr. Mackenzie), and just see whether he didn’t by implication suggest we should be in the incentive business.

Hon. Mr. Grossman: Oh, but that was three months ago. That’s different.

Mr. Cassidy: Supplementary: Did the Premier receive any specific commitments of any nature at all from the automobile manufacturers or the parts producers about improving their performance within Canada; and is the government now prepared to make public its analysis of by how much those companies are failing to live up to the fair-share concept as far as Canada is concerned?

Hon. Mr. Davis: I am sure the member has the figures from the UAW, which has done an analysis of this; he already has those. The government of Canada has produced certain figures; we have produced certain figures. We can spend hours and hours and weeks and weeks debating figures. What we have to do is to find answers, and the answers are not as simple as the leader of the New Democratic Party would suggest.

We are endeavouring to get, not in terms of a commitment in that sense of the word, because I don’t know what it means; what we are endeavouring to do is to see that some of the capital growth that is anticipated takes place, that the jobs that already exist are maintained in a secure way; and as I say I have made a particular point with the companies in the field of research and development, because there’s one place they can’t argue with me since they have not made that sort of commitment or investment in the automotive business in this country. They don’t deny it.

I don’t know whether they are going to react to this sort of thing or not, but we are trying very hard. I think it is important not only from an economic but from a sociological point of view as well.

Mr. Laughren: You should get McKeough and Rhodes together.

Hon. B. Stephenson: They are not apart.

Mr. Kerrio: Supplementary: Is it the Premier’s understanding that the auto pact was really to accommodate the automobile manufacturers so that they could, in fact, take advantage of building engines here and bodies there, and trade across the border without too much inconvenience? If that was the case, and since there has been such an imbalance for so long, I wonder if we wouldn’t be wise in suggesting to the federal government that it is time we threw the auto pact out and went back to protecting the workers in Canada by the tariff method?

Mr. Mackenzie: It would end the automotive industry.

Hon. Mr. Davis: I don’t want to get into this, but I think the member will find that if he has any constituents who work in any of these plants he should raise that with them. I won’t, as I have done facetiously on one or two occasions, intimate that what the member for Niagara Falls has suggested has become the official policy of the Liberal Party of Ontario. I don’t think as a party they would support that. I think the member would find that we would be in relatively serious economic difficulty.

Mr. Cooke: Supplementary: I would like to ask the Premier just simply why should we have to pay the auto companies in this country to live up to an auto pact they agreed to? Why should the province of Ontario or the federal government have to pay them to live up to the pact?

Hon. Mr. Grossman: Your leader was asking for it three months ago. Your leader was asking three months ago why we didn’t.

Hon. Mr. Davis: Of course, we get around to a debate, and this is part of the current discussion that is going on. This is why the government of Canada has now gone the route it has. I just wish they had started this a year ago or two years ago.

Mr. Laughren: You might have provided some leadership there. You have provided no leadership.

Hon. Mr. Davis: There is a debate in terms of the companies as to whether or not -- we are all aware of this -- within the terms of the auto pact, as companies, they are meeting it. As I read some of the figures, a lot of the imbalance is with respect to parts; and I am not getting into that sort of questionable debate either. I would say it is not a question of why should we give money if they are not going to live up to the pact. We are faced with a practical, real problem; and that is a certain company is in the process of making a significant decision that involves the potential of a lot of jobs.

It is fine for the members opposite to say: “Beat them over the head. Club them. Do whatever you can.” But, I have to tell them, that just might not work.

[11:30]

Mr. Cooke: That’s not what we are saying. They are beating us over the head right now.

Hon. Mr. Davis: That may come as a bit of a surprise to the members opposite: It might not work.

Mr. Mackenzie: Your private enterprise system isn’t working either.

Hon. Mr. Davis: I have to say to the honourable member -- I guess he does things his way, although I sense it is not the way he gets elected locally -- he can suggest things he wants to in this House; we will do things our way. They may differ.

Mr. Laughren: Which way? Your way or John Rhodes’ way?

Hon. Mr. Davis: If that is a supplementary from the member for Nickel Belt, I have to assure him that not only is there great consensus on the approach to this issue between myself and the Minister of Industry and Tourism, but he just has to look at what his own leader and the member for Hamilton East have said with respect to this particular issue and what he is saying today; he will think they are totally different, and they are.

Mr. Laughren: Deal with your own cabinet.

Mr. Renwick: The cabinet is split right down the centre.

Hon. Mr. Grossman: Quit while you’re behind, guys.

HEALTH RECORDS

Hon. Mr. Timbrell: Mr. Speaker, last week the member for Oshawa asked a question concerning confidential medical records from Wellesley Hospital. Several hundred sheets of paper containing medical records from the hospital were found blowing around a parking lot at Sherbourne and Richmond Streets on the morning of June 12.

In answering the honourable member’s question, I would like to refer to the present legislation covering the manner in which hospitals handle patient records, outline what the hospital itself has done to prevent such a mishap from recurring and what my ministry is doing to further minimize the possibility of a similar slipup happening at other hospitals in the province.

Also, the Krever commission is currently looking into the confidentiality of hospital records and has already held a special hearing into the Wellesley Hospital incident.

In the Wellesley case, the records found in the parking lot were copies of records kept by the hospital. The copies were in the process of being disposed of when the mishap occurred. They had been placed in plastic bags, and the hospital is of the opinion they fell from a garbage truck hauling them away.

The distinction between copies of records and the actual records themselves is an important one, because the current regulations under the Public Hospitals Act do not cover disposable materials of this kind; that is, duplicate or extra copies of records. The regulations deal only with what be termed the formal medical records of the hospital or photographic copies made for a permanent record.

Section 43 of regulation 729 under the act requires that the hospital administrator make out and keep a statutory declaration setting out the facts concerning the disposal of permanent records. In this case I am advised there has been no contravention of the Public Hospitals Act or its regulations, but obviously the Wellesley case shows there is a loophole in the regulations. To cover this, officials of my ministry are drafting a letter which will go to all hospitals telling them to treat copies of medical records in the same way they would treat their official medical records and asking them to review their procedures for the safeguarding of such records.

Officials at the Wellesley Hospital, I have been advised, combed the site on June 12 and 13 and attempted to ensure that they retrieved every single record that was retrievable. To ensure such a mishap is not repeated, they have temporarily halted disposal of such records. They have issued a circular to all hospital departments asking that the patient’s identity be removed from all types of records before records are sent for disposal, and they are developing a policy and procedures manual which will address the whole subject of confidentiality and disposal of medical records.

Finally, I have directed officials of my ministry to work closely with the Ontario Hospital Association to prepare a set of guidelines for all hospitals covering the handling and disposal of medical records. These guidelines will provide a consistent approach to this matter until such time as we are able to take advantage of the extensive and thorough investigation currently under way by Mr. Justice Krever. We will be looking to that commission’s recommendation as the basis for a long-term solution to the serious and difficult problem of maintaining confidentiality in our health care system.

Mr. Breaugh: Mr. Speaker, I wonder if I could be given a supplementary on that response. The minister pointed out the unique loophole in the law about copies as opposed to original records. I heard him indicate that he is prepared to write to them, to prepare guidelines and all that; but I did not hear him say that he is prepared now to make regulations which would close that loophole. Is he prepared to do that?

Hon. Mr. Timbrell: I think that would be unnecessary at this point. We will direct them to treat the copies in exactly the same manner as permanent records, and I think that will cover it until we get the report, probably later in the fall, from the Krever commission. Then we can make the long-term changes as necessary, through either legislation or regulations.

Mr. Breaugh: A further supplementary on that: I really don’t know why the minister is not prepared to move to the regulation stage now. Would it not be true, no matter what kind of letter or guidelines the minister sent out, there would still be no validity to any argument that any law has been broken should copies be released in this manner or in any other manner? Isn’t the basic problem the fact that the law does not require them to address themselves to copies of medical records?

Hon. Mr. Timbrell: I’m one who believes one passes a law if there’s some resistance to a less formal route. I have no reason to believe from the discussions between my staff and myself with people in the hospital community that there will be any resistance at all. I don’t think we should constantly keep rolling in new regulations. I think we can do it on a voluntary basis. I don’t foresee any problem that way.

PREMIUM ASSISTANCE

Hon. Mr. Timbrell: The second question I’d like to answer came from the member for London Centre on June 15. He asked -- and I’m paraphrasing, I believe -- why don’t we reveal to an applicant for temporary premium assistance the upper limit of his financial status which would preclude his being eligible for temporary premium assistance. I hope that’s accurate.

The formula used for granting temporary assistance incorporates the applicant’s present income, liquid assets and number of dependants. This information is provided by the applicant on the original application. With regard to the factors taken into consideration, a resident may apply for temporary assistance based on the immediate financial need due to unemployment, illness, disability or financial hardship. The factors under which an application will be considered are clearly requested on the application for temporary assistance.

The practice up until now has been for OHIP to advise an applicant whose application has been refused that he may have it reviewed by the OHIP management committee. OHIP did not advise the applicant that he could appeal to the health services appeal board.

On June 5, 10 days before the member raised the question, I directed the staff of OHIP to ensure that all insured persons were advised of their rights to appeal under section 24 of the Health Insurance Act. I have been advised by my officials at OHIP that there were very few refusals -- about one half dozen a month -- that the OHIP review committee had turned down.

In future, applicants whose request for temporary premium assistance is denied will be advised in writing by OHIP of their right to appeal to the health services appeal board. Applications for temporary assistance which are initially turned down from here on in will automatically be reviewed by the OHIP review committee before the above-mentioned notice goes to the individual concerned about the health services appeal board. We’ll cut out a step of delay for the individual applicant.

Mr. Peterson: I understand they have a right to appeal under section 24. I appreciate the fact that the minister has cleaned up the procedure in informing applicants of their rights. But clearly that’s not the issue. Would the minister not agree with me that the issue is that there are no set guidelines and there are no rules against which they can appeal. How can one present one’s case to the review committee if one does not know what the upper limits of income or assets are, be it liquid or otherwise?

If the minister checks with the Attorney General (Mr. McMurtry), clearly there is a denial of justice if people don’t know the rules against which they can appeal. Isn’t that the issue?

Hon. Mr. Timbrell: Each case is judged on its merits.

Mr. Peterson: How do you judge the merits without guidelines?

Hon. Mr. Timbrell: One could take six illustrations of a family of four and come up with a completely different mix of assets, mortgages, outstanding debts, et cetera. Each one is judged on its merits. It’s a matter of substantiating need. I point out to the member again very few are turned down; it’s something in the order of six a month.

Mr. Peterson: Wouldn’t the minister agree with me this leaves this quasi-judicial procedure to the whim or the predisposition of the review board? The rules are not nearly enough clear. It’s far too discretionary for an applicant to have real justice in the circumstances.

Hon. Mr. Timbrell: No, I wouldn’t agree at all.

WASTE DISPOSAL

Mr. C. I. Miller: I would like to address a question to the Minister of the Environment. In view of the public apprehension and concern over the matter of liquid industrial waste and the need for immediate action, will the minister reconsider his position and set up a task force which could study the matter over the summer and bring in recommendations for action no later than this fall?

Hon. Mr. McCague: That question was asked by the critic for the NDP the other day. I said I didn’t see that there was any necessity for a special task force. We are looking into that. I have had discussions with the member’s leader, who happens to endorse that kind of a situation; I am meeting with the leader and with the critic of that party to discuss some of these issues. I’m surprised the member didn’t check with him before he asked that.

MEAT PACKING DISPUTE

Mr. Ziemba: A question to the Minister of Agriculture and Food: Given that under ordinary conditions when a company goes on strike its main competitor will rush out and do the business that the struck company cannot do, and given that Canada Packers did not do this when its main competitor, Swift’s, was at this disadvantage -- in fact Canada Packers locked its own workers out and stopped doing business as well -- would this suggest to the minister that there is a Canada Packers-Swift meat cartel? Is he prepared to bring this cartel before our food industry inquiry to investigate how it affects the producer and the consumer?

Hon. W. Newman: The answer to that question is no.

Mr. Speaker: The time for oral questions has expired.

Hon. Mr. Davis: Darn!

Mr. Breithaupt: Darn! Have a good summer. Saved by the bell.

Mr. Cassidy: On a point of order, I just want to ask the Premier and the House leader, since the matter of the auto pact is of such importance, whether they will agree by agreement between the House leaders that within a week of the House resuming its sessions in the fall we can have a special one-day debate on the auto pact and that all of the information --

Mr. Speaker: That’s not a point of order. You had an opportunity to ask that during question period.

PETITION

MINISTRY OF THE ENVIRONMENT ANNUAL REPORT

Ms. Bryden: I have in my hand a petition signed by 20 members of the Legislature requesting that the latest annual report of the Ministry of the Environment be referred to the standing committee on resources development for consideration and report when it meets on resumption of sittings in the fall. I hope the minister will undertake to prepare material for this consideration over the summer, particularly on the question of liquid industrial waste, which has reached crisis proportions. Mr. Speaker, would you like me to read the petition?

Mr. T. P. Reid: No.

Mr. Speaker: It is sufficient to present it to the table.

REPORTS

MINISTRY OF LABOUR

Hon. B. Stephenson presented the annual report of the Workmen’s Compensation Board for 1977; the interim statement of the Advisory Council on Occupational Health and Occupational Safety, November 1, 1977-March 31, 1978; the annual report of the Ministry of Labour, 1977-78; and the 1976-77 report on the status of women crown employees.

Hon. B. Stephenson: I wonder if I might make a brief statement about the report of the status of women crown employees, which I am depositing today with the Clerk. I had hoped to have this report earlier this year, however, I think the honourable members will realize that a fair amount of time and work had to go into developing this report again this year. Additional copies of the report and the appendix will be available from the women crown employees office within the next few weeks.

I’d like to take this opportunity to outline several changes in the organization and operation of the women’s programs, the most significant, of course, being the elimination of the position of executive co-ordinator. Experience has shown that at this stage of the program’s development a senior co-ordinator is really no longer necessary and resources from that office have been distributed between the women crown employees office and the women’s bureau quite effectively.

With the elimination of that position, a number of other changes were required as well. For example, the women crown employees office is now responsible for preparation of this report, in close co-operation with the central agencies of government. Formerly, the executive co-ordinator represented the government of Ontario on the Status of Women Council. That responsibility is now fulfilled by the director of the women’s bureau.

The Deputy Minister of Labour is now the ex officio member of the Civil Service Commission, replacing the executive coordinator in that role. The Affirmative Action Council, which formerly reported to the executive co-ordinator, reports now to the women crown employees office.

[11:15]

The honourable members will notice that the women crown employees office has made several changes in the format of the report as well. For instance, the ministry and agency chapters have been simplified and are provided under separate cover. The report is similar to those of preceding years in that it reports on corporate activities and analyses government-wide statistics. It shows some very positive trends are beginning to emerge in the status of women crown employees. For example, the number of women moving into job areas where they have been underrepresented or into levels that they have never reached before, has increased from 130 in 1975-76 to 440 in 1976-77. In addition, 23 of the 29 ministries and agencies for which we have comparable data reported a slight narrowing of the wage gap between men’s and women’s salaries for the 1976-77 year.

During the year 1975-76, the average woman’s wage was 70.4 per cent of the average male’s wage; daring 1976-77 that had risen to 72.3 per cent.

While we are pleased to see these improvements, we are aware there has been little change in the occupational distribution of female employees. A strong continued effort in the affirmative action program will be required to bring about this long-term goal.

STANDING ADMINISTRATION OF JUSTICE COMMITTEE

Mr. Ziemba, on behalf of Mr. Philip from the standing administration of justice committee, reported the following resolution:

Resolved, that supply in the following amounts and to defray the expenses of the Ministry of Correctional Services be granted to Her Majesty for the fiscal year ending March 31, 1979:

Ministry of Correctional Services

Ministry administration program ... $ 7,844,000

Institutional program .................. 100,149,000

Community program ................... 15,158,000

MOTION

COMMITTEE SUBSTITUTIONS

Hon. Mr. Welch moved that Mr. Havrot be substituted for Mr. Elgie, and Mr. Lane for Mr. Turner on the select committee on the Ombudsman. Also, that Mr. Laughren be substituted for Mr. Warner on the select committee on company law.

Motion agreed to.

INTRODUCTION OF BILL

HIGHWAY TRAFFIC AMENDMENT ACT

Mr. Peterson moved first reading of Bill 140, An Act to amend the Highway Traffic Act.

Motion agreed to.

ANSWERS TO QUESTIONS ON NOTICE PAPER

Hon. Mr. Welch: Before the orders of the day, I wish to table the answers to questions 104, 105, 106 and 107 standing on the notice paper.

ORDERS OF THE DAY

SECURITIES ACT

Hon. Mr. Grossman moved third reading of Bill 7, An Act to revise the Securities Act.

Mr. Breithaupt: There is one particular thing that I did want to bring to the attention of the minister as we complete this bill in a formal way.

As members of the House will recall, the- committee stage of this bill was finished on Wednesday, June 21. Now that the bill has been reprinted, we are able to proceed with it in the normal way. However, on Monday and Tuesday, June 19 and 20, there were certain public hearings dealing with the matter which is known as “going private” which the Ontario Securities Commission held in the Macdonald Block.

Those meetings related to some comments which the minister made during the committee stage of the bill when he spoke in committee on June 15. At that time, he acknowledged the great complicated problem that this whole subject brought to the securities industry and he said the following:

“This is a difficult and complicated area where detailed policy requires the benefit of experience. Accordingly, it would not be feasible to include guidelines in the bill at this time. However, I have instructed Mr. Baille in the Ontario Securities Commission to prepare draft guidelines indicating the basis on which their discretion will be exercised, and explaining in more detail how they interpret the word ‘control.’

“These guidelines will be published for comment and discussion and will be revised in final form before the bill is proclaimed into law. Should discussion of the draft guidelines, or subsequent experience, indicate that changes are needed in the legislation, we will not hesitate to return to the assembly with appropriate proposals for an amending bill.”

This matter particularly refers to section 91 in the bill. Following the statement that the minister made, I am somewhat concerned as to whether it is his intention not to have this bill proclaimed until those regulations are in place. Or is it the minister’s intention to have the bill proclaimed, and then deal with the matter for regulation? It would be my view that the security bill, Bill 7, and the following two bills should be in place at the earliest opportunity. But I am wondering if the minister can tell us what procedure he intends to follow with respect to proclamation, so that the industry can clearly know just what the ground rules are?

Hon. Mr. Grossman: There were a couple of matters raised at the committee stage. The one I recall the member referring to, and reading from the transcript, I think related not so much to the going private situation as to the takeover provisions of the legislation.

Mr. Breithaupt: More common.

Hon. Mr. Grossman: These, of course, were the more common situations up until the last recent number of months.

With regard to those provisions we did want specifically to indicate to the industry that we did have some reservations, after having heard from them both at the securities commission level and at committee stage. We were concerned that perhaps the takeover provisions were such that they may stop some takeovers that might otherwise occur and operate to the advantage of Ontario and Canada generally. So it was because of that concern that we wanted to be in a position to indicate to the industry the circumstances under which the commission would be exercising its rights and discretion to grant an exemption from those takeover provisions. That would provide some degree of predictability so that some takeovers, which might operate to the advantage of our economy in Ontario, could occur and proceed without speculation or worry.

It was that provision, not so much the going private part, that we were addressing at that time; although we have made clear, both in and outside the committee, our concern, as the members will be well aware, about the new phenomenon of going private. We have made it very clear that we are studying it and will have much more to say about it in the next few months.

Specifically we undertook the committee to try and develop those rules before the bill is proclaimed. My understanding is that we agreed at the committee stage to try and develop both those guidelines and the guidelines for disclosure of senior officers’ salaries prior to proclaiming the legislation.

At the current time, Mr. Baillie has told me that he expects it would take almost the balance of this calendar year to have all that in place because they are very complicated regulations. He said if we were to stay on that course the bill would not be proclaimed until, say, the end of this year. That does give me some cause for concern. I must say to the member that as of this date -- the bill only having passed committee last Wednesday, as you know -- I haven’t resolved a course of action with Mr. Baillie, either to go ahead without those rules in place, or to hold off until those rules are in place.

If the member and the House will permit us, we will let the critics know what our intentions are, and the industry know what our intentions are, literally in the next three or four weeks. But I must be honest: we haven’t been able to resolve those two conflicting concerns at the present time.

Motion agreed to.

THIRD READING

Bill 8, An Act to regulate Trading in Commodity Futures Contracts.

Bill 9, An Act to amend the Business Corporations Act.

CONCURRENCE IN SUPPLY

Resolutions for supply for the following ministries were concurred in by the House:

Ministry of the Solicitor General;

Ministry of Agriculture and Food;

Ministry of Colleges and Universities;

Ministry of Correctional Services.

WORKMEN’S COMPENSATION AMENDMENT ACT (CONCLUDED)

Resumption of the adjourned debate on the motion for second reading of Bill 126, An Act to amend the Workmen’s Compensation Act.

Mr. Kerrio: Mr. Speaker, in the interests of getting the business of the House completed, 1 would like to summarize and get on the record just a couple of my concerns regarding the bill.

As I suggested before, the increases in the act certainly are welcome on all sides of the House. But along with the increases I must read into the record the concerns that I have as they relate to the payments. As the cost escalation that relates to pegging these payments concerns me, I would like to read into the record the increases in assessments from 1970. I am taking a particular group because this was reported in a report by one of the auto manufacturers -- group 306. In 1970 the rate for group 306 was $59.90 per $100. By 1974, it had more than doubled to $132. For 1978, it had risen to $337.50. This represents a 470 per cent increase since 1970 and a 155 per cent increase since 1974.

The reason I make much of this aspect of Workmen’s Compensation is because I have a very strong feeling that unless we take the responsible position of doing something about relieving some industry from the burden entirely, and that the burden be shared by those other people in our society, it becomes very easy to pass legislation that would just take increases and pass the cost to a third party. I think that area could very well be looked into and a reasonable assessment made so that those people who cannot just pass on those substantial increases are given some form of help.

In the minister’s program as it relates to safety, where there was an involvement of employees, employers and the government -- an extremely good program -- the results are known to all in the industry. We have established something there that was beyond what most people had expected or hoped for. We’ve reduced the accidents because we had the co-operation of employers, employees and the government. I am suggesting that until such time as everyone related to workmen’s compensation becomes involved in a more meaningful way we will continue to have these kind of increases before us. I am just a little afraid they will put us in a position where we become less and less competitive on the international scene.

So while I am very pleased about what has happened here, and I am particularly pleased about the retroactivity, I would ask the minister in some further studies to look into that matter as it relates to more involvement with everyone involved in Workmen’s Compensation at any level to participate to the degree that it is to the advantage of everyone concerned, to have a better record, to have fewer injured workers, to look after and retrain those who are injured, and to make the whole system work to the benefit of everyone in this community and in society.

[12:00]

Mr. Foulds: Mr. Speaker, I just have three points that I would like to make and I would like to make them as briefly as possible this morning. I would like to make them as a result of some of the things that were said, or not said, last night and during the course of the debate.

Mr. Nixon: Was there something not said last night?

Hon. B. Stephenson: Everything was said.

Mr. Foulds: All kinds of things were left unsaid last night.

Although I disagree profoundly with the attitudes expressed by the member for Niagara Falls and supported by the government, I must say that I respect the viewpoint. I disagree with it profoundly because I think it starts from a wrong premise; the member for Niagara Falls obviously has the same feeling about my viewpoint.

This morning I would like to discuss, if possible in a civilized way, a few of the reasons for those differences.

Mr. Kerrio: I just proved that I could do it both ways.

Mr. Lupusella: Why don’t you shut up?

Mr. Foulds: Yes, indeed, the member was very calm this morning.

I think it is important that we recognize the concept of workmen’s compensation for what it is. The concept is that we compensate a worker who has been injured on the job in terms of his earnings at the time of the accident. In some sense there is a fundamental flaw in the way we have administered the program that is not addressed in this particular bill, except incidentally in section 2 and some of the subsections by agreeing to a percentage difference for each of the years.

What we don’t take into account is the loss in earning power. Over roughly the last 35 years, we have had a period of inflation of various rates. Since the 1930s we have not had a period of deflation. It would seem to me that if, as a result of the actuarial soundness in the plan, we cannot take into account the projected increase that a worker who is injured loses in terms of the increase that would naturally accrue to him as he worked and perhaps went up the ladder in terms of position -- in terms of apprenticeship to journeyman, or in the case of my dad, for example, from section man to section foreman to roadmaster; he was blocked from going to the roadmaster’s position because of an injury that made him ineligible for the position. If we cannot take that into account -- and I think we should -- at least we should take into account an indexing that would keep his level of income in line with the increase in the cost of living. It seems to me that is only fair.

It may not be possible to do it in the emergency situation that we have had in the House yesterday and today; we want to get this bill through. However, I think it is a concept that the minister and the board should look at. It struck me with some irony that we passed a bill yesterday morning having to do with the Crown Timber Act which met the indexing requirements, justifiably, in terms of the levies paid by the pulp and paper companies for the product they get from the people of Ontario related to the cost of the end product and what they receive in the market.

If we can devise a formula of indexing that seems to give security and certainty to the industry in that case, at a moving level, surely we could devise an indexing formula in this case to give the worker who is injured the certainty and the security of knowing that at least his level of income would match the cost of living increase. I would submit to this House that if that happens we would, in fact, save a good deal of administrative costs, in terms of the board, because a number of the cases that I receive, and that every member of this House receives, that the board itself receives, are reassessments and re-evaluations of an old case, simply because the person can no longer survive on the amount of the benefits.

It may not be necessary to do a medical reassessment and so on. I think we would save some administrative costs that way and I think we would certainly save a lot of emotional and functional overlay that sometimes applies in these cases. I think that is one of the benefits that the board and the minister should look at in considering that avenue.

The other point is that which the member for Niagara Falls seemed to make, that as a human being, he would like to give as generous benefits as possible without destroying the economy. I may be doing his argument an injustice but, as I heard it, that seems to be if we don’t make our industry uncompetitive.

I quote from the Wyatt repost -- and I admit that it’s selective -- on page 175, under the heading, “Who pays for Workmen’s Compensation?” Essentially, the report says:

“In the end, the total cost of employing a worker includes wages and the cost of all employee benefits, including the cost of workmen’s compensation. The employer must weigh this total cost against the value of the worker’s output in determining whether to employ the worker. Thus, the cost of all alleged social gains can be considered to fall invariably upon the wage earner.” You can take that argument to its logical conclusion and it sometimes falls on the wage earner in terms of unemployment. But it does fall on the wage earner and the working people of this province; and I think we should recognize they are the people who pay for the cost of compensation.

The final point that I want to make, Mr. Speaker, is that we fundamentally disagree with the position of both the Liberal and the Conservative parties in terms of how wealth gets created in this province. I want to put to you very, very succinctly that no matter how much money, no matter how much investment, no matter how much managerial skill the free-enterprise system puts into our economy, the gross provincial product would not exist, the gross national product would not exist, wealth would not exist if it were not for labour.

Labour is the essential ingredient in the creation of wealth. You take away that essential ingredient and we would have an economy like the middle ages or worse. It is the only essential ingredient in the creation of wealth. If that is so, it seems to us that we should treat those people whose activity, whose work creates that wealth, with dignity and we should treat the loss of their ability to work with dignity; and some of the workmen have, unfortunately, sacrificed their lives and their limbs simply in the pursuit of work. We should recognize that work is the essential element in the creation of wealth, we should recognize that even within a bill as confined as the Workmen’s Compensation Board Act, and we should, therefore, pay the reward for work.

We should, therefore, pay the compensation benefits that are related to the wages earned at a level of dignity that allows that person to continue to live in dignity, to be a human being in dignity when he loses that ability to work and create wealth.

Mr. Sweeney: Mr. Speaker, I want to participate just for a very brief period of time. I must say I am moved by the remarks of the previous speaker. I would certainly support his contention that the efforts of labour, of the working people of the province, certainly are an essential component to the creation of wealth in all economic sectors of our province. I would only point out to the member, however, that they are one of the essential components. They are not the only component, and so at one and the same time I am strongly supporting his contention but just trying to put it somewhat into perspective.

Mr. Speaker, the only point I want to address myself to, and I guess it’s more in the form of a question than in the form of a comment, is with respect to those injured workers who are on partial permanent disability pensions. I am not able to understand as clearly as I would like to the way in which this bill assists those kinds of workers. It was brought up last night by one of the members of the third party -- and I am sorry I can’t recall which member -- that the particular salary range on which, as I understand it, permanent partial disability payments are made, are not always the fairest way of dealing with the situation.

If you take a worker who was injured in 1972, or 1973, or whatever year you choose to pick, and recognize that his disability pension is based upon his earnings at that particular point in time, and even though there are periodic percentage increases there still seems to be a considerable disproportion, and I would suggest, Madam Minister, a disservice to that worker in respect of what he potentially could be earning at this point in time, even assuming he stayed at that same job, even if we assume that there were no potential increases in his particular status, that he hadn’t moved, let’s say, into the position of a foreman or a supervisory officer at some point in time. The question I would like to address to the minister is, has this particular factor been given any serious consideration and to what extent, because I quite admit I can’t understand directly how the bill relates to that particular factor.

The second point I would like to ask the minister about is to what extent this bill in any way relates to that same person on a permanent partial disability with respect to his inability to get another job. I am sure the minister is well aware of the number of such persons who come to our attention as members of this Legislature who in desperation say: “I have tried everything. I have tried to get light work. I have tried to get part-time work.” Even though the message has supposedly gone out from the ministry that employers are under some obligation to provide some assistance to this person, I simply can’t get it.

I know there is a provision at the present time that a person who is still in the process of looking for work will get a larger compensation benefit, but I also understand there is a limit to that, that at some point in time this appears to be cut off. I would like some explanation from the minister to what extent that factor is covered in this bill; and thirdly, speaking again to the same group of people, to what extent people who have been on permanent partial disability pensions for quite a long period of time before the particular practice that I just described came into force. I understand it is a fairly recent innovation with the compensation board; it has only been in the last short period of time. It is not my understanding that it does cover people who date back a couple of years.

[12:15]

Quite frankly, with respect to this bill I am dealing with a very narrow group of people, but it has been my experience as a member of this Legislature that it is that particular group of people with which I have had the greatest difficulty in providing some assistance. They simply seemed to be locked into a system and into a structure that has no way out. With all the goodwill in the world on everyone’s part, the system doesn’t seem to work for those people. They are perhaps in more desperate straits than almost anyone else. I would appreciate it if the minister could address herself to that.

Hon. B. Stephenson: It has been an interesting experience, to say the least, to hear the presentations of all the members in both parties on the opposite side of the House over the last several hours.

There have been some interesting suggestions and some queries about the scope of the bill which is before us. I would remind honourable members that the scope of this bill is necessarily limited. It is limited specifically to increasing benefit levels for those who receive benefits from the Workmen’s Compensation Board on the basis of increased costs to those individuals and, in a way which, it is hoped, will cover most of those increased costs.

The policies, the philosophy, structure and function of the board are not addressed in Bill 126. It is obvious on even a brief perusal of the Wyatt report that as a result of the Wyatt study some of those structures and functions and perhaps some of the philosophies, and policies may need to be re-examined critically. It is my intention to pursue that line of activity throughout the summer months and thereafter with the hope of developing whatever is necessary in the way of providing those improvements.

This bill is limited specifically to the improvement of benefit levels. Although it does not address itself directly to the extra benefits which were available to the permanently partially disabled while they are in the process of looking for employment, those benefits will accrue to them because the extra funding which is available will be provided at the increased base for those individuals.

There is really no limitation to that benefit as long as the individual workman is cooperating in a vocational rehabilitation program and co-operating with his vocational rehabilitation officer. The case must be reviewed on a regular basis -- six months, a year or something of that sort -- but as long as there is evidence of co-operation those benefits can continue. In some instances, they have gone on for several years. That was brought in in 1975 with the amendments. I am given to understand that most of those with permanent partial disabilities who have not made themselves available for this kind of assistance have not benefited. But it is possible to make application to the board for that kind of service, if it is necessary.

The suggestions that have been made about the way in which the Wyatt report might be carried out have been very useful. I would like honourable members to know that over the summer months the special committee which is made up of staff of my ministry will have some representation on it from other ministries and certainly from the Workmen’s Compensation Board. It will be examining the Wyatt report and assessing all of the alternative concepts which are inherent in that report.

I should be delighted to have any critical assessment or any kind of input which the honourable members opposite would like to submit to me during the summer months in the process of this initial, fairly in-depth examination of the report. When that has been completed, I am very willing to take under serious consideration the idea which was proposed by the member for Quinte (Mr. O’Neil) that a small group, representative of all parties, might take a look at the report in the light of the assessment which is carried out by the committee. I shall certainly consider that most seriously because that may be a very useful way in which to do this.

I do believe, as a result of the very exhaustive study which the Wyatt Company carried out, that there are some recommendations which must be considered seriously regarding the role, the structure and the function of the Workmen’s Compensation Board. It is essential that we do that as carefully but as rapidly as we can.

There were some questions raised about the rationale for the ceiling and raised about moving to a universal insurance program for accident victims. There is a conflict here because, if we were to attempt to move to a universal accident insurance program, we would be limiting the possibility of introducing that program if we took off the income ceiling. We are not going to be able to develop an actuarial base upon which to establish a universal program unless we have some carefully defined parameters in order to move in that direction.

Suggestions have been made, and I am aware of the amendments which the New Democratic Party is bringing in, but I can only suggest that it was my concern to bring in reasonable and responsible increments in the benefit levels which were very closely related to the increase in cost of living. The final figure of six per cent was related to the best estimate that could be made at the time of the cost-of-living increase for this year; it may be a little out of line now, but it certainly was made on that basis just a few weeks ago when it was established.

I am informed that these recommendations also closely follow the recommendations of the joint consultative committee, which is a committee appointed for the board’s edification and made up of representatives of trade unions and management, and of ordinary citizens within the community. I am informed that their recommendations to the board were very closely in line with the recommendations which appear before the members of the House.

Mr. O’Neil: Can we get a copy of those?

Hon. B. Stephenson: I don’t have a copy of them, but I shall try to get a copy for the member. However, I am informed that they are very close to those as well; so that there has been external assessment of this need by a group not directly related to the benefits of the board but certainly with great interest in the board’s function and that their recommendations closely approximate these.

I would remind the members that the amendments which the New Democratic Party is suggesting for this bill are really changes which are perhaps in conflict with some of the philosophy and some of the ideas of the social contract between employers and employees -- a social contract which I would be very unhappy to see broken at this time. I would hope that they would think very seriously about those amendments at this time. They may be useful amendments to consider when we consider further modifications of the Workmen’s Compensation Act in the total concept of the act, rather than simply on the basis of benefit levels.

Mr. Speaker, that is really all I would like to say at this time. I am grateful for the interesting suggestions that have been made regarding some of the new initiatives or the new directions which might be considered for workmen’s compensation in this province and they will most certainly all be considered very seriously.

Motion agreed to.

House in committee of the whole.

WORKMEN’S COMPENSATION AMENDMENT ACT

Consideration of Bill 126, An Act to amend the Workmen’s Compensation Act.

On section 1:

Mr. Lupusella: Mr. Chairman, just a few minutes ago I heard the Minister of Labour herself state that the scope of this particular bill is quite limited. The limited scope of the bill is also reflected in this particular section 1(1)(a). I remember when I made a speech on the budget on June 21, 1976, on the floor of this Legislature, and I drew the attention of the Minister of Labour to the fact that something was bothering me about this particular section. I want to quote for the record what I said in 1976.

Hon. B. Stephenson: What section?

Mr. Lupusella: Section 1(1)(a). For the sake of the record I want to report what I said in 1976 in the budget debate. I quote: “In a province where the average cost of burial is $1,200 the act only allows $600 for the burial of a worker killed on the job. I guess the difference is a sort of deterrent fee.”

I was quite dissatisfied. People are complaining about this particular cost. It’s a clear cut case that workers are dying and the Workmen’s Compensation Board is not adequately reflecting the cost of a burial. I want to share with the minister my sense of frustration when I’m dealing with so many widows and widowers in my area who are saying the Workmen’s Compensation Board is net paying sufficient money for the burial costs of workers who die on the job. They show this sense of frustration.

I’m sure the Minister of Labour and the Workmen’s Compensation Board do not really understand the position of a lot of people in the province of Ontario, specifically, people coming from different ethnic backgrounds, who are really concerned about the burial costs. For them, it’s some sort of veneration they want to show to the person who died on the job or who died a natural death. They want to express their veneration to the person who died either on the job or of natural causes by having a decent burial ceremony. That’s what this government and the Minister of Labour do not understand.

What this government is doing in this particular clause is offending the tradition of a lot of people in the province of Ontario coming from different ethnic backgrounds who are really concerned about the cost of burial. I know the Minister of Labour disagrees with me but it’s a reality which exists in the province of Ontario and I want to bring to the attention of the Minister of Labour this particular concern of a lot of people, particularly people from different ethnic communities, to have a decent burial ceremony. The minister is emphasizing the $800, but even though the amount was increased from $600 to $800 the average cost of a burial was around $1,200 in 1976 and I guess the cost has increased in 1978.

[12:30]

Why is she not taking into consideration this concern coming from different people? They’re not just losing their husband or their wife, but they have to pay more for the burial cost because, as I stated before, they are particularly concerned and through the ceremony they want to express this sense of veneration to the person who passed away.

I expressed this concern in 1976. I don’t think that the $800 payment is sufficient. Even though the Minister of Labour showed some concern in providing for a $200-increase, she is very well aware that the average cost is around $1,500 for a decent burial.

Mr. Ziemba: It is $2,000.

Hon. B. Stephenson: It is not.

Mr. Lupusella: It’s not? Do you have a figure for that?

Mr. Ziemba: Can you bury somebody for $800?

Hon. B. Stephenson: I have had some recent experience with it.

Mr. Lupusella: Again, the Minister of Labour really doesn’t want to understand the concern of those people who want to have a decent burial ceremony. She missed the main principle of what I have just said.

Mr. Ziemba: A cardboard box.

Mr. Lupusella: If you are really concerned about multiculturalism, since the government is talking about multiculturalism, that’s how this government can interpret the needs of those people.

Mr. O’Neil: That’s not a matter of principle in the bill.

Mr. Lupusella: Through tradition and custom they are getting into this situation. They are losing their husbands and they are losing their wives. They have to pay more money. The Workmen’s Compensation Act does not properly cover the total cost. I don’t know if the minister made any inquiries around the province of Ontario that would suggest that the average burial cost is $800. I don’t have the same estimate. I would like to hear from her.

Mr. Ziemba: Name the funeral homes.

Mr. Lupusella: I hope that when she brings in legislation, she will take into consideration this concern.

Hon. B. Stephenson: The survey which was carried out by the Workmen’s Compensation Board and by others regarding funeral costs would lead us to believe that $800 would cover the average cost for most funerals. It should be noted that it’s not the purpose of Workmen’s Compensation Board death benefits to line the pockets of funeral directors. The purpose is to meet the cost which is imposed upon a family as a result of that death. That is why there is an immediate lump sum payment of $800 proposed in the revised benefits, as well as the funeral cost of $800, an increase of $200 each of those benefits. There is as well the cost which will be covered at whatever it is for the necessary transportation of the body.

It would seem to me that because Ontario is now leading, except for British Columbia, in this area that probably we are at this level meeting the actual cost of funeral services in most instances.

Mr. McClellan: We’re leading except for British Columbia? We are not leading the way?

Hon. B. Stephenson: There it is only $855, or $55 more.

Mr. Lupusella: You’re missing the principle of what I was saying.

Hon. B. Stephenson: I know what you are saying.

Mr. Bounsall: Speaking very briefly to this same section, I must admit this doesn’t occur to me to be a place where I would naturally place an amendment increasing the amount. I certainly appreciate the feelings of the member for Dovercourt and members coming from communities in which a certain level and standard of funeral and burial are the accepted norm. I am a member of the Memorial Society and a very strong supporter of all their activities. I have a prepaid funeral for myself which costs much less than the $800.

Mr. O’Neil: Stay with us a while.

Mr. Bounsall: I will be cremated in the cardboard box in which caskets are shipped, after they have removed --

Hon. B. Stephenson: You are not intending to use it this week, are you?

Mr. Bounsall: It’s all ready. It’s prepaid and that’s the way I feel I can be disposed of with dignity when the time comes. Anything else is unduly ostentatious. It only costs $4 to open up the cemetery plot the size to get the ashes in --

Mr. Haggerty: He’s just telling us $800 is too much.

Mr. Bounsall: That to me is the way things should be going, although I will probably arrange for the person who opened that up to be tipped handsomely.

Hon. B. Stephenson: You are not suggesting this should be reduced on the basis of your experience?

Mr. Bounsall: No, I’m not. I find myself very much in the minority in terms of my views on how my body should be disposed of. I do appreciate the feeling that is prevalent in large segments of our society that a somewhat different funeral, disposal and burial practice should be carried out and is the norm.

In this regard, I quite appreciate the minister’s view too that what we shouldn’t be doing is lining the pockets of the funeral directors. I would suspect from my contacts through the memorial society with funeral directors, that they would immediately be aware of the amounts in the Workmen’s Compensation Board Act, and their first question would be to any widow or widower, were they killed in the work place. And somehow, automatically their cost would be, as a minimum, equal to what they have in the act. That, I agree with the minister, should not be encouraged.

In the thorough, ongoing review which we make of the act, as prompted by the three authors of the Wyatt report, maybe we could have a look at that area. However, I am not inclined personally to be too interested in this section. Perhaps we should be putting some sort of maximum on it and paying 75 per cent of whatever the funeral cost is up to this maximum. Then the widow or widower can feel some freedom to choose a range of funeral services, knowing beforehand she or he is paying a quarter or a third of that total that would not be reimbursed by the board. Perhaps that’s one of the things we could consider.

Mr. Deputy Chairman: Shall section 1(1)(a) stand as part of the bill? Carried.

Mr. Bounsall moves that in subsections 2 and 3 clauses (c), (d), (e) and (f) of subsection 1 of section 36 of the act be amended by, in clause (i): replacing $318 to $448, in clause (ii), replacing $344 with $493, in clause (iii), $365 with $523, (d) replacing $93 with $95, $99 with $101, $98 with $99, $106 with $109, and $113 with $116 where those numbers occur.

And following clause (f) shall be added: “and the amounts payable under this section shall be adjusted on the first day of July in each succeeding year commencing with July 1, 1979 by a percentage amount equal to the percentage change in average wages and salaries in Ontario for the calendar year previous as indicated by the industrial composite average weekly wages and salaries for Ontario published by Statistics Canada.”

Mr. Bounsall: I am speaking briefly to this, but I hope with some conviction. There are three principles involved in this amendment: The minor one of the three is the fact that the percentages used to change the existing numbers in the bill, I found had no rationale to them. The first change is to be a change reflecting the cost of living or per cent salaries and wages for the year 1975. The minister has 11 per cent in the bill. The cost of living for 1975 went up 10 per cent, and the per cent increase in salaries and wages went up 12 per cent. As I said last night, perhaps she chose the middle ground, 11 per cent, between those two. That would be fine.

The same remarks would apply to the year 1976 for the second change. It could have been guessed at, as I was doing, that she was choosing the middle ground between the increase in the cost of living and increase in salaries and wages. This works out to eight per cent, the cost-of-living increase being six per cent, and the increase in salaries and wages 10 per cent.

If that were the case, however, when one gets to the third change embodied in the bill, which would be looking at the entire year 1977 -- and numbers are available for the entire year -- the cost of living went up 14 per cent -- actually that is a rounded off figure, it went up 13.9 per cent -- and the per cent increase in salaries and wages was six per cent. Again if one is splitting the difference we would get a 10 per cent factor, rather than the one chosen by the minister -- six per cent. So that rationale fell apart then in terms of what she may have been doing in choosing the mix. There is no justification for the six per cent.

The question was then, what does one pick? Does one agree with the minister in her 11 and eight per cent, and propose a 10 per cent which would be assuming a mix of those two -- an equal mix of those two factors? Or should one take the consumer price index directly, in which case it would be lower in the first two years and much higher for the third adjustment? Or should one take per cent salaries and wages?

As I stated last night, all I did was choose one of those three alternatives; rather than the cost of living, rather than the 50-50 mix of cost of living and per cent increase in salaries and wages, I choose the per cent increase in salaries and wages, on the basis that this is the rational adjustment to be made to benefits which are supported to make some compensation for the loss of earnings of workers in the work place. That is the most rational basis on which to place it -- salaries and wages. So I simply have adjusted in the bill, and this is the first time it reflects it, for each of the figures in the bill, a 12 per cent rather than 11 per cent in the first year, a 10 per cent rather than an eight per cent in the second year of the adjustment, and I agree that six per cent would be the comparable figure in the third. So those changes are reflected in the numbers, and this occurs throughout the bill.

They are small changes, but it is an attempt, by moving these amendments, to have the board and the ministry accept that there should be some rationale for the numbers which one picks to make those change in benefits. This is preferable to the ad hoc system which, surprisingly in so comprehensive a report that took 15 months in the making, was defended by Mr. Field, Mr. Inglis and Mr. Smart from the Wyatt Company who wrote the report. One almost gets the distinct feeling that they are promoting an ad hoc system with respect to changes, something which I would hope the ministry and the board would have by now moved away from.

However those are small changes. I would not be unduly upset if the ministry decided that the changes were sufficiently small between the figures proposed by the ministry and by myself, they weren’t worth making the change. Although in each and every case, because of the higher staffing figures for the first two years, they do result in slightly higher figures coming out.

[12:45]

The second principle, and this is the important one, I feel in this section, is the pension being paid to the widows and widowers of workers killed in the work place. Those figures used in the bill as the base were those figures introduced in 1975 and moved away from the position which the board had taken in the years 1971 to 1975. Then the amount paid to widows and widowers, because of their spouses being killed in the work place, was identical to the minimum of the totally permanently disabled.

That was in existence from 1971 to 1975 in the board. It looked as if, and it was never denied, that was the rationale why those figures were identical. It was never positively stated by the board that this is why those figures are there, but when pointed out that they were identical heads would nod wisely as if that was the basis and a rational basis for why those were identical.

In 1975, we increased rather substantially the minimums for the totally permanently disabled and increased the widows’ and widowers’ pensions only by the 10 per cent adjustment that we made in 1975. Therefore, we were moving off what I think was a very valid principle: that the pension paid to a widow or widower as a result of their spouse being killed in the work place the pension should -- not only could but should be identical with the pension that would be paid to that spouse if that spouse had survived but was now permanently disabled.

It seems to me those have full justification for being identical, because what could be more permanently disabling to a worker than to be killed in the work place? Therefore those pensions should be identical. So you will see in the bill the actual change for the widows and widowers is substantial. I have moved them from the numbers in the bill to be equal to the permanently fully disabled category with those small percentage changes which I have mentioned previously.

The final clause is the automatic escalator. Again, this is something not favoured by the three authors of the Wyatt report. But again I was struck by the very retrogressive attitude of the authors of the Wyatt report with respect to why they shouldn’t index. Their contention was that if one indexed, this might be inflationary. Therefore, if it was going to be inflationary we shouldn’t index. And of course all this does is keep workers --

Mr. Haggerty: Sheer nonsense.

Mr. Bounsall: This is the Wyatt report. I don’t know whether you have read it yet, Ray. That certainly is a nonsensical statement in Wyatt when you are adjusting well behind the fact. We’ve called for an adjustment to be made in July according to the changes made in the previous calendar year. So they are still well behind.

The justification given by these three gentlemen for that section of the Wyatt report dealing with the adjustment of benefits certainly makes their whole attitude suspect in my mind. The authors of the Wyatt report, I think, appear quite capable in terms of looking at the financial arrangements and rating experience practices and the financial position of the board and how the board should operate differently in administrative terms and the cost associated with that administration. I think they are quite capable as actuaries in dealing with those aspects. But with those statements occurring early on in section 3 -- that we shouldn’t index benefit provisions because it might be inflationary -- makes that whole section suspect.

They certainly can look at balance sheets and certainly from their practice as actuaries make thorough estimates of the other parts of the report, but it reflects that their social conscience, with respect to that kind of benefits, is quite suspect just from that particular comment alone, and their willingness throughout to be the kings of ad hockery and to have no rational basis for the percentages they propose.

We very much feel in the final section in this amendment that it should be adjusted yearly by the same percentage equal to the percentage change in the average wages and salaries across Ontario, it would give the board ample time to do it. For example, the percentage change in average salaries and wages for 1978 would be known no later than February or March 1979, giving ample time to change the figures for July 1 in terms of paying out those benefits. That would help the board administratively. It would cause them no administrative problems with that much lead time.

I would like to make one final comment on the numbers affected. Since the debate last night, I got the absolutely up-to-date figures on how many widows and widowers we’re talking about in Ontario. There are 62,263 persons on pensions in Ontario of whom only 5,045 are widows and widowers as of April 6, 1978. We’re not talking about a very large percentage of the pension recipients of the board. Roughly around eight per cent or a shade less would be affected by this amendment. We’re talking about roughly a $150 per month change or about $750,000 in the total per month to pay them a pension that’s properly in line with those who are permanently fully disabled.

I would hope the members of the Liberal Party would agree and the Minister of Labour would accept that this is now the valid basis on which widows’ pensions should be based.

Mr. O’Neil: We will not be supporting this amendment. As I mentioned in my opening remarks concerning the bill, we would like more time to have a look at the Wyatt report and the other information that will be available to the members of this Legislature.

Mr. Deans: That’s the government position.

Mr. O’Neil: At that time, we will be looking to see if amendments should be proposed. Therefore, we will not be supporting that amendment.

Mr. McClellan: I have to say I’m bitterly disappointed that the Liberal Party does not intend to support this amendment. As things stand now, the widow of a worker who is killed on the job is forced to rely on welfare, on social assistance, to support herself and her family.

Hon. B. Stephenson: She may be.

Mr. Deans: And most are.

Mr. Deputy Chairman: Order.

Mr. McClellan: I would like the minister to explain to me how a widow is supposed to raise a family on the payment that stands as of today, namely $265.

Hon. B. Stephenson: A widow with children gets benefits for the children as well.

Mr. McClellan: The reality is that the replacement income under the workmen’s compensation program for the loss of a principal breadwinner through death has never been sufficient to enable the family to continue to live at any kind of a standard on compensation benefits alone. It is absolutely essential, if employment is not a possibility for whatever circumstances, for the widow to turn to social assistance. The minister knows that full well.

We have not raised the widows’ benefits to an unreasonable amount. We have not, for example, as we could have done, raised the amounts in accordance with the standard of adequacy. We could have taken the position that widows’ benefits ought to be based on a recognized standard of adequacy and set them accordingly. Because we feel it is the most reasonable thing to do at this time, we have chosen to base widows’ pensions on the principle, as my colleague has stated, that the benefit paid to a widow ought to be the same as the maximum benefit paid to the spouse, had he lived, at full permanent total disability rate. That’s precisely what we’ve done.

I believe, having done some calculations, that the amounts of money that would be granted under the amendment are certainly more generous than anything a family would receive through supplementation on general welfare assistance or family benefits. The amounts do approach a standard of adequacy; they are certainly above the Statistics Canada poverty line figures.

The principle ought to be -- and I am deeply dismayed at the position of the Liberal Party -- that the widow of an injured worker should not have to turn to welfare but that the workmen’s compensation provisions ought to be adequate to enable her to support herself and her family.

The second point that I want to make is with respect to indexing. I have already commented on the sorry disgrace that it has been to all of us. It has been a blot on all of us that the compensation rates have not been raised since 1975. Any government that would allow the compensation rates to go unadjusted for three years should not be trusted. It’s as simple as that. They should not be left with the discretionary power of when cost- of-living increases should be brought back before this House. We should amend the bill so that the cost-of-living increase is automatic. This government has betrayed that trust.

Mr. O’Neil: We may amend it, too, in the fall.

Mr. Ziemba: Then why don’t you do it?

Mr. McClellan: Do it now while the bill is before you.

Mr. Deputy Chairman: Order.

Mr. McClellan: They can do it now, Mr. Chairman, while the bill is before them.

Mr. O’Neil: A little more study is needed to be --

Mr. Ziemba: You’ve studied it for three years.

Mr. McClellan: You don’t need any more study.

Mr. Deputy Chairman: Order. Can I ask the member for Quinte to cease interjecting and the member for Bellwoods to address the chair?

Mr. McClellan: Thank you, Mr. Chairman. I will ignore the interjections.

The index we have chosen as the automatic cost-of-living adjustment is the industrial composite average weekly wage. That is, without doubt, the most appropriate index for workers’ compensation.

Mr. Ziemba: It’s not too radical for the Liberals, is it?

Mr. McClellan: I say again, it is irresponsible to leave the discretion to bring back cost-of-living indexes to this government. Indexing has to be built into the bill, because this government has shown that it is not capable of being trusted to bring back the legislation for annual cost-of-living increases.

Mr. Haggerty: Mr. Chairman, I want to address myself to the particular section of the bill, section 1(2), I believe it is, and perhaps make a few comments on the amendments put forward by the member to my left,

Actually, the amendment is indexing the workmen’s compensation to the present cost of living, wages and so forth, as mentioned by the members. I was interested to read page 188 of the Wyatt report dealing with indexing and escalation. I suppose one could get into this thing in some detail, but I just want to quote from one paragraph.

“Attempts to compensate for inflation are not, of course, a cure for inflation. The only cure for inflation is to end inflation.” It goes on to say: “We will not attempt to offer a solution.” So perhaps it’s going to be wide open for debate. Some of their other comments relate to the benefit area of the workmen’s compensation as to whether to increase it and, in some cases, they even suggested decreasing it.

[1:00]

Hopefully, they are not going to take that approach or the government isn’t going to accept the recommendations that the way to end inflation is to stop any increases at all to the injured workers. When I look at the amendment to the act, I note we have increased it for a surviving spouse to $365 per month. I would suggest to the minister, as the member for Bellwoods has mentioned, it is enough to drive a person to welfare or to go under the Family Benefits Act.

In fact, if you look at the Family Benefits Act closely enough, it far outweighs the benefits under the Workmen’s Compensation Act. Under the Family Benefits Act, they will provide financial assistance to purchase a home and even to pay the rent. Under this act, if a surviving spouse through the loss of the breadwinner is left with a heavy payment on a mortgaged home, then $365 would perhaps only pay the mortgage on that home. There’s nothing left for the survivor to maintain a self-sustaining good standard of living.

I feel in this particular area consideration should be given. I am sure in certain areas where there is a surviving spouse under certain circumstances maybe the home is paid for. In other cases, I think that with 25- to 30-year mortgages today, there are very few surviving spouses who will have removed that debt.

Hon. Mr. Welch: Would the honourable member permit me to make some adjustment in time for a minute?

On motion by Hon. Mr. Welch, the committee of the whole House reported progress.

Hon Mr. Welch moved that the House sit past 1 o’clock.

Motion agreed to.

ANSWERS TO QUESTIONS ON NOTICE PAPER

Hon. Mr. Welch: While we are still in House, could I just take a minute to table the answers to questions 29 and 128 standing on the notice paper, table the response to sessional paper 108 and table the answers to questions 33, 44, 109 and 110 standing on the notice paper.

House in committee of the whole.

WORKMEN’S COMPENSATION ACT (CONTINUED)

Resumption of consideration of Bill 126, An Act to amend the Workmen’s Compensation Act.

On section 1:

Mr. Haggerty: I was addressing myself to the section of the bill that relates to spouses’ benefits. The matter relates to the person who is left with a large debt such as a mortgage. There is no consideration given here that the board will take this into consideration. I think in a number of circumstances that consideration must be given to this particular area.

I don’t know why the report says it wants to encourage the person, the surviving spouse, to remarry or enter into another similar contract. I can’t quite accept that approach. I suggest to the minister in this particular area that there are persons who have lost their husband and who have a large debt that has to be paid off. Perhaps some widows do not wish to marry at the present time or in three or four or five years.

Consideration must be given in this particular area under certain circumstances. I leave it to the discretion of the board or to the minister to put something in the act that would allow for additional payments in case of a heavy debt where the breadwinners no longer can provide for the survivors and the family.

Mr. Lupusella: On that section, I hope the Liberal Party, particularly the member for Niagara Falls, will express their concern on that vote.

Mr. O’Neil: He’s not here to defend himself.

Mr. Chairman: Order.

Mr. Lupusella: Let me say, then, the Liberal Party as a whole.

Mrs. Campbell: Let’s deal with the bill.

Mr. Lupusella: I’m speaking to the principle of the bill. I hope the Liberal Party as a whole will express their goodwill in relation to this amendment which has been introduced by my colleague to index injured workers’ pensions to the cost of living.

As I stated last night, it seems that the total 25 per cent increase which is contained in Bill 126 does not really reflect the needs of injured workers. I especially emphasize one aspect or one angle about certain injured workers who are permanently partially disabled, namely, that the 25 per cent increase might result in an increase of $2, $3 or $4. What the minister is doing and what this government is doing is to upset those permanently partially injured workers with little pensions. In view of this increase, they will see only an additional $2 or $3 on their pay cheque at the end of the month coming from the Workmen’s Compensation Board.

If I may, I think this amendment was supposed to be the main focus of solving the cause of injured workers in Ontario. That’s why I am inviting the Liberal Party strongly, vehemently and adamantly, to support this amendment if they want to share their concern about injured workers without emphasizing really the problems employers will face on the increase in their premiums.

Nobody in Ontario would like to see accidents. That is the aim to which this Legislature should address itself in order to prevent this social disaster which takes place from one year to the next here in Ontario. I think the main problem, if this amendment is not passed by this Legislature, is again we will be penalizing a particular group of injured workers.

Mr. Chairman: Order. I would ask the member to return to the principle of the amendment, which is in regard to widows’ and dependants’ benefits. Does the honourable member have anything in regard to the amendment?

Mr. Lupusella: Yes, Mr. Chairman. As I stated before, I am particularly upset that the 25 per cent increase in that bill does not reflect the 30 per cent cost-price index. The Minister of Labour promised us in the past that she would take a close look at this situation. They are going to study the formula, but I don’t really have too much trust in that commitment. Whenever we raise an issue in this Legislature, it takes years and years of study. Then the Minister of Labour comes out with a formula which is not even solving the problem. That’s the comment which I wanted to raise.

Mr. Bounsall: One short comment, Mr. Chairman. I was quite pleased to bear the remarks of the member for Erie (Mr. Haggerty) on this amendment that deals with the adjustments of widow’s pensions. Obviously, with his vast experience and time in the House with workmen’s compensation, he feels that more of an adjustment should be made than has been provided in the bill. And I would hope that his colleagues in the Liberal Party would take that very much under advisement.

What I do object to -- and I am not trying to be controversial here but I just feel that at some point it should be said and I agree very much with the remarks made by the member for St. George (Mrs. Campbell) last night -- is that every year we are here in the last day or two of June dealing with a Workmen’s Compensation Board benefit amendment, and at some point that should end. At some point we are going to have, and should have, sufficient time for a bill of this sort to be sent to committee outside the House where we can have a thorough and ongoing investigation of why the particular numbers were chosen and what ad hockery went into the choice of those numbers. Because it does disturb me that it should be so ad hoc a proposal as submitted by the three authors of the Wyatt report. And I feel rather strongly about this.

Certainly when we come to the consideration of the Workmen’s Compensation Board report which should be taking place this fall, we can simply --

Mr. Chairman: That is not before the committee at this moment.

Mr. Laughren: We can debate it later on this afternoon.

Mr. Bounsall: That’s right. I am speaking to that portion of the amendment which deals with the adjustment, the amount by which the pension should be adjusted. At that time, when we come to the consideration of the board’s report in the fall, we can go into that ad hockery versus a formula situation, in some depth and over some days with the authors of these reports, the people who sat on those committees and so on. I understand that can be done at that point. But we should end the practice of dealing with it in the last day or two.

However, let me simply point out that the attitude of the member for Quinte rather disturbs me. We have had this bill since Monday. It is now Friday. No one member is busier than any other member. I have had time and my colleagues in this party have had time to thoroughly read the Wyatt report.

Mr. Laughren: Page after page.

Mr. Bounsall: I have read it twice. I have read the legislation. I have been able to make the adjustments on it, and it didn’t take that much time. That is no reason for the member for Quinte, primarily charged with the bringing of the bill through for the Liberal Party, I gather, to sort of indicate that we will have a discussion in the fall, and implying that he hasn’t had enough time in four days to have a comprehensive look at this bill. That does disturb me.

Mr. Laughren: Good point.

Mr. Bounsall: I am disturbed that we don’t have more time. But at least we have had four days. That amount of work could have been done, as myself and other colleagues in our party have done; and I am affronted.

Mr. Lupusella: Most of it.

Mr. Bounsall: Most of us, right. And I am affronted that that is the excuse given by the spokesperson for the Liberal Party as to why they are not taking an in-depth look and supporting rational amendments placed by ourselves.

Mr. Laughren: Did the minister find a seat for Michael Starr yet?

Mr. Lupusella: Just smile, don’t be upset.

Hon. B. Stephenson: I am not upset; I am just bored.

Mr. Lupusella: You never smile.

Mrs. Campbell: Mr. Chairman, I too wish to address myself to the provisions of these amendments as they affect a widow or widower. Unfortunately, I suppose that a greater number would be widows. That seems to be the experience that I have had in working with these cases.

Hon. B. Stephenson: Males are the weaker vessels, Margaret.

Mrs. Campbell: Yes, I understand that but in my experience of the injured work person -- and I am not only dealing as some of my colleagues apparently are with injured workmen; I am thinking of those who are injured. The female worker gets basically very much less consideration under workmen’s compensation than her male counterpart.

[1:15]

Mr. Laughren: John MacBeth understands that. John MacBeth knows that. As Minister of Labour he tried to do something about it. Bring back John MacBeth.

Mrs. Campbell: In this particular section, however, I would like to address myself to that portion which does deal with widows, because I had hoped that this minister, through all the staff she has to give consideration to the problems of women left as widows in our society, could have come up with something a little more equitable for these people.

One of the great crying needs in this community today is to take a look at pension benefits for widows, generally speaking. Usually this government, for example, in its provisions for pensions for its own staff is quite prepared to let the widow of such a staff person try to get along on infinitely less, as a result of pension, than the male employee has.

I would have thought, I would have hoped, that this minister with all of her staff might really have come forward with a very strong statement on behalf of those who are forced to live in these circumstances in our society today. That consideration has to come; it must come because the inequities are so very clear. Yet here we are with a formula which does improve a situation but which doesn’t really take into consideration the responsibilities of that dependant who is left widower.

Again, I am in the position where I feel almost as though I am taking bribe for the first time in my political career, because I feel I’m being bribed by these measures to proceed with consideration quite apart from all the other important considerations that should be before us. Because I have to; I have to see that this goes through. I must. We cannot delay the solution for these people any longer.

The treatment which has been accorded them has been inhuman, it has been inhuman, but I am powerless --

Mr. Laughren: I am glad you are supporting our amendments.

Mrs. Campbell: -- to change this section, basically, I suppose, because of the rules of the House and the matter of money. I can’t tell you how I could amend to give equity here. I don’t know how I could amend to do that.

Mr. Laughren: There’s no problem. It’s not a money bill.

Mr. Bounsall: Support ours for the interim.

Mrs. Campbell: The indexing suggestion is one which this government has endorsed in the past for others. I would like to see this government with the same policies for its people as it has for the federal obligations. I would like to see that. Perhaps it might see the same principle for municipalities, but not here, not here. I don’t understand it.

The minister is an honourable person and I accept that what she is trying to do is the best that she can, having in mind the matter of the whole cabinet and the cabinet discussions of this matter. But I do want to make a special appeal to her in this particular case, because her voice is strong. We know that, we realize that, and that gives her a very much greater responsibility, it seems to me.

The women in this House really do have to work sometimes to educate. This is a beautiful moment for her, to take that opportunity to educate the members of her cabinet who may not understand. In any event, I trust I have made my point. I don’t like this kind of a debate because often it gives the appearance of mouthing things for partisan political purposes. I have tried to avoid that. I have tried to avoid that because the overall concern that I have is for these people. I think I’ve proven that in my life in politics.

I would like, therefore, to challenge the minister to take a firm stand on the matter. I would like to engage her for a moment in time in this particular section in some philosophical debates on the matter, if she would engage in it, so that I could have assurance that by the fall we would come to grips with this problem and that we would, indeed, be reviewing it with a view to giving to widows, and automatically widowers too, but to widows primarily, some equity.

Hon. B. Stephenson: Could I just remind the honourable members that while I share their concern about those individuals who are left spouseless as a result of industrial accidents, I would remind them that the philosophy of the Workmen’s Compensation Act has been that pensions are paid to disabled workers on the basis of earnings and, indeed, they’re a function of the earnings of the individual, but under the act this allowance, if you like, or pension to the bereft spouse is, in fact, statutory in terms of its benefits.

My concern is that at this time we haven’t time to debate all of the things that need to be examined in the area of perhaps modifying the philosophy of the act, which I think is something which would be a useful exercise for all of us and could be very productive in terms of modifying the act. I really would like to ensure that we get some reasonable increase in benefits on the road right now, but certainly that would have to be a part of the deliberations regarding the act in the future.

At the present time, under the present philosophy of the act, it seems to me that this is the right route to go. I’m not an economist. I have no mathematical expertise and I’m certainly not an actuary. I have been alarmed by the numbers of thoughtful people who are specialists in that kind of area, whose opinions I value and who have expressed real concern about the problems of indexing. I am aware of past enthusiasm for this kind of procedure and present caution regarding indexing. I think we must be as knowledgeable about that as we possibly can be. I believe we must develop a mechanism whereby annual changes to benefit levels can occur, but at this point I don’t know what that mechanism is.

The Wyatt report gives us a little guidance towards several kinds of alternatives which might, indeed, be looked at in this area. This is why I am hoping that as a result of our in-depth study of it we will be able to develop a mechanism which will be more satisfactory. At the present time, we are working within the somewhat firm guidelines of the philosophy of the Workmen’s Compensation Act. I think we should move with the recommendations which have been brought in.

Mr. Laughren: I understand what the minister said, and perhaps it is an indication of how desperately we need to change that approach to dependants’ allowances, because it should not be viewed that way.

Hon. B. Stephenson: But that is the way it is.

Mr. Laughren: That’s what I said, I understand that that’s the way it is in a statutory manner, but that’s not the way it should be. I really would hope that we have wide-ranging debate next fall. Perhaps we could set aside a day to debate the --

Hon. B. Stephenson: Cut 10 hours off the estimates and we will have the debate.

Mr. Laughren: No, we could add 10 hours on to the estimates to talk about the Wyatt report and the implications of the content.

Hon. B. Stephenson: You want to spend all fall on my estimates?

Mr. Bounsall: Why not?

Mr. Laughren: I must admit that there is a degree of pain involved in that kind of decision but we would be willing to make the sacrifice, yes.

Mr. Bounsall: I might just point out that it’s a statutory requirement under the Workmen’s Compensation Board Act that the WCB report that was tabled today be referred to a standing committee. There is no time limit on that. When that does occur this fall, that will be the time, whatever number of days it takes, to talk to the authors of the Wyatt report and any other expert staff you want to bring in to simply thrash that whole question out. We would be delighted to take the two or three days on this whole section at that time.

Mr. Chairman: All those in favour of Mr. Bounsall’s amendment please say “aye.”

All those opposed please say “nay.”

In my opinion the nays have it.

Amendment stacked.

Section 2 agreed to.

On section 3:

Mr. Chairman: Mr. Bounsall moves that subsection 1 of the bill, subsection 8(c) of section 42 of the act, be amended by: in clause (a) replacing “11 per cent” by “12 per cent”; in clause (b), replacing “eight per cent” with “10 per cent;” adding after clause (e) “and the amounts payable under this section shall be adjusted on the first day of July in each succeeding year commencing with July 1, 1979, by a percentage amount equal to the percentage change in average wages and salaries in Ontario for the calendar year previous, as indicated by the industrial composite average weekly wages and salaries for Ontario published by Statistics Canada.

Mr. Bounsall: Just very briefly, in the previous amendment we have covered the change or attitudes in the House with respect to, at this point at least, the percentage changes that should automatically accrue. So I will not run over that part of the argument.

[1:30]

What this amendment highlights is, again, something which the minister has still not quite replied to. I thought I understood how she arrived at her 11 per cent for the year 1975, as a mix of the CPI and the per cent salaries and wages; how the eight per cent was arrived at for the year 1976, again as an equal mix of CPI and per cent salaries and wages; and yet for the third year, 1977, she chose the smaller of those two indices, the six per cent increase in salaries and wages, rather than the CPI, which was 14 per cent, or a mix of those two, which would have brought it up to 10 per cent.

I have explained the amendment which we have placed; that is, the pure and simple per cent salaries and wages increase, which turned out to be 12, 10 and a number, six, equal to what took place in the third year.

I would still ask the minister, is it purely ad hockery involved in the percentages picked, and is there no basis for it? And does she not agree with us that some basis could be chosen -- and there are three areas you can choose to do it in: pure CPI, pure per cent increase in salaries and wages, or a 50-50 mix of the two -- does she not agree that one of those three methods should have been chosen and, if so, why doesn’t she do it as such in this bill?

Mr. Lupusella: Mr. Chairman, I was in the process of proceeding with my comments previously, but it seems I was not addressing myself to the right amendment.

I want to take the opportunity here to emphasize a particular problem which is faced by a lot of injured workers in Ontario in relation to the level of disability as assessed by the Workmen’s Compensation Board. I think there is a big loophole in the process of assessment, particularly as it affects injured workers who are permanently and partially disabled.

Injured workers are penalized in both ways. They are penalized because the level of benefits is not indexed to the cost of living and in the way in which the Workmen’s Compensation Board is assessing the level of disability.

Hon. B. Stephenson: That’s not in the bill.

Mr. Lupusella: It is part of the bill. I am trying to emphasize that they are penalized in both ways; and if the minister does not accept the particular amendment that has been put forward by my colleague, we will penalize them further, because they are already penalized by the fact that the permanent disability rating schedule is too old. I think the Workmen’s Compensation Board, in co-operation with the Minister of Labour, should revise the board’s basis for assessing permanent and the partial disabilities.

I have in front of me the rating schedule, which upsets me. I want to give you an example, Mr. Chairman --

Mr. Chairman: I would say to the honourable member he was referring a few minutes ago to revising the system. I don’t think this amendment revised the system; it changes the rate.

Mr. Laughren: You have to agree it needs to be done, though, Mr. Chairman.

Hon. B. Stephenson: But it has nothing to do with this bill.

Mr. Chairman: Would the honourable member return to the amendment, please?

Mr. Lupusella: Mr. Chairman, what I am trying to emphasize is that the amendment which has been introduced by my colleague would solve at least part of the problem faced by injured workers, because at least they wouldn’t have to come around every year to put pressure on the government and the Workmen’s Compensation Board in order that those changes take place.

Hon. B. Stephenson: It is not going to make any difference to the permanent or partially disabled.

Mr. Lupusella: The Minister of Labour is just trying to make promises, as she has done in the past, but the act should be revised, and the Workmen’s Compensation Board and the Minister of Labour should take a look at the studies and reports that were tabled in the Legislature in order that suitable ways can be found to implement the right formula, which will take into consideration the cost-of-living increase.

We cannot count on those promises. Words are words. What this Legislature and the members of this party are looking for is a strong commitment to take a close look at the problems faced by injured workers, because the cost of living is increasing every year. There is no particular section in the bill which takes into consideration this particular concern. That is why it is imperative that the government and the Liberal Party support this clause to alleviate in some way problems encountered by injured workers in Ontario.

As I emphasized previously, the workers most affected are those who were injured a few years ago when the annual ceiling was not very high. As I stated before, we don’t have very many injured workers in Ontario making $15,000 per year; now the ceiling has been increased to $16,200 a year. We don’t have many workers in that position. Actually, the workers in this particular category who get an assessment from the Workmen’s Compensation Board as a result of an accident are going to get a higher assessment as a result of the new ceiling, in comparison to those workers who were injured 10 or 15 years ago. That’s where the Minister of Labour really fails to face this situation and cover this particular loophole which affects all of those workers who were injured in the past and who have a minimum level of pension because the ceiling in effect at the time they were injured was not very high. I don’t think the present system takes their needs into consideration.

What I want to suggest to the Minister of Labour is that she take a close look at this permanent disability rating schedule so that it will be revised in order that the percentage be increased, because otherwise we are leaving an opportunity for the Workmen’s Compensation Board to play its own game just on the percentage of this rating schedule. The figures might sound fine, but the Workmen’s Compensation Board might assess the minimum level of disability and, when injured workers are faced with a permanent partial disability, they won’t get the benefits they are looking for.

My final comment is to solicit the attention of the Minister of Labour to take a close look at the permanent disability rating schedule.

Hon. B. Stephenson: Mr. Chairman, may I just make one small comment? The potential cost to the employers of this province -- this has been done by an expert, not by me -- of the addition after clause (c) contained in this amendment is estimated to be in the order of $850 million.

Mr. Kerrio: Money doesn’t mean anything to the NDP.

Mr. Chairman: All those in favour of Mr Bounsall’s amendment will please say “aye.”

All those opposed will please say “nay.”

In my opinion the nays have it.

Amendment stacked.

Mr. Bounsall: I have a further amendment on section 3(2). I believe you have a copy of this before you as well, Mr. Chairman.

Mr. Chairman: Mr. Bounsall moved that in section 3(2) of the bill, subsection 9 of section 42 of the act be amended by adding after “part” in line two, “except for a series of lump sum awards which taken together exceeds 10 per cent of the earning capacity of the employee.”

Mr. Bounsall: This is a section which does bother me as to whether or not one should dispense with subsection 9 in total or make the kind of amendment which I have made. I do feel rather concerned that since lump sum payments have been made in the past, for whatever reason, that any amendments to the act increasing the amounts of pension paid should be paid on those lump sums.

I realize the administrative difficulty of that and in many cases, the small amounts of money involved in the initial instance anyway, for which the adjustment would then be small. I realize the effect upon the receiver is not very profound in any event. That is what has caused me to present this amendment which is, in essence, a compromise or a fallback position from that feeling which I have because of the small amounts of money thereby involved.

It covers the situation of a person who has initially been rated for a pension that was rated initially at eight per cent. I have one in my riding in precisely this situation now. Because it was less than 10 per cent, the act virtually requires that they be paid a lump sum. An appeal subsequently was made upon the pension rating and on appeal that was increased to 15 per cent. That represented another seven per cent. Because that was less than 10 per cent, again a lump sum award was made. Subsequent to that, some few years later, an appeal was made on that pension rating and it was again increased. I think it finally ended up that the pension rating which should have been that way all along, rather than eight per cent in the initial instance or 15 per cent at one point, should have been 22 per cent. Because of the difference between 15 per cent and 22 per cent is less than 10 per cent, a lump sum award comes out to her.

In no way, could she get anything else in each of those instances but that lump sum award which, if she had been given the pension rating she should have got in the first instance, which would have been 22 per cent, it would have come on a monthly basis and she would have been eligible and would have been receiving all of those increases to those pensions that is occurring in section 3 of this bill and occurred in 1974 and in 1975.

I’m quite willing to have the board not pay an increase in the pension to someone who has had a lump sum that is less than 10 per cent or even on the commuted amount where a pension has been commuted. It is for those persons caught in the situation of a series of lump sum awards which taken together are more than 10 per cent, more than the percentage by which they were required to take a lump sum, so that they have those additional percentages as outlined in this act applied to those lump sum awards.

They are caught by accident in an unfortunate situation of not having had proper pension ratings as they went along and being caught in a situation where lump sum awards by the act had to be paid out. Arriving at a final rating in this case I believe it’s a final position -- in her situation, which is well above, if it was given all at one time, the necessity to pay it in a lump sums she has been and is continuing to be, unless this carries, in a situation where she is being disadvantaged because of inaccurate or not complete enough pension ratings, certainly in the first instance, and in the second instance of the three times that she’s been in contact with the board over a pension rating.

I suppose that the wording could be changed slightly if this bothers the ministry or the Workmen’s Compensation Board. I think the earning capacity phrase which I used in the amendment could more properly be clearer if I put in average earnings instead of earning capacity, so the amendment perhaps might best read, “except for a series of lump sum awards which taken together exceeds 10 per cent of the average earnings of the employee,” just to be completely clear that I am talking about the pension rating on whatever the pension rating is based.

Mr. Deputy Chairman: Do I understand that you want to change your amendment from what is before me?

Mr. Bounsall: If it would help. “Earning capacity” could easily be changed to “average earnings” if that poses any particular problem to the acceptance of the amendment. If you can do that easily that would be a help.

Hon. B. Stephenson: Mr. Speaker, it is perhaps unfortunate that we saw this amendment only late yesterday afternoon. The example which the member has given us is an intriguing example. I am not sure whether, indeed, it has any counterparts within the experience of the board, but it would seem to me that it’s not likely to be very frequent.

I think this is something that perhaps could be considered at some point, but I really can’t see at this stage of the game that it would be reasonable to consider this amendment with its complexity, not knowing what the incidence is likely to be, what the frequency is likely to be or what the cost is likely to be and I think it would be unwise to accept it.

Mr. B. Newman: May I suggest to the minister that she give careful consideration to the amendment, not necessarily accepting it today, and then amending the act at some time in the future if she finds the incidence quite frequent?

Mr. Bounsall: In response to the minister, I am encouraged by her attitude in this and may I just say, perhaps very sotto voce and it certainly shouldn’t be advertised that they are so doing, that maybe the administration at the Workmen’s Compensation Board, when this sort of case is brought to their attention, even though the legislation doesn’t particularly -- doesn’t allow for it -- in fact, would disallow it -- that perhaps a slipup could be made at the board, and those adjustments made in any event?

Mr. Deputy Chairman: Mr. Bounsall has moved in section 3, subsection 2 of the bill that subsection 9 of section 42 of the act be amended by adding after “part” in line two, “except for a series of lump sum awards which taken together exceed 10 per cent of the average earnings of the employee.”

All those in favour, please say “aye.”

All those opposed will please say “nay.”

In my opinion the nays have it.

Amendment stacked.

On section 4:

Mr. Deputy Chairman: Mr. Bounsall moves in subsection 1 of section 4 of the bill that subsection (b)(i) of section 43 of the act be amended by: in clause (i), replacing $444 with $448; in clause (ii), replacing $480 with $493: in clause (iii), replacing $509 with $523: and adding after clause (iii), “and the amounts payable under this section shall be adjusted from the first day of July in each succeeding year commencing with July 1, 1979, by a percentage amount equal to the percentage change in average wages and salaries in Ontario for the calendar year previous, as indicated by the industrial composite average weekly wages and salaries for Ontario published by Statistics Canada.”

Mr. Bounsall: On this point, I am again simply following through in a consistent way with the other types of amendments we have made. Here again the second point is indexing; we have covered that already. In the interest of time, no more need be said about it. The small changes in the amounts contained in the act, which I have made in my proposal, simply reflect once again that I wish to apply not an ad-hoc scale to the changes, not ad-hoc percentages to the changes, but percentages to increases for the permanently totally disabled, percentage increases equal and commensurate with the changes that have occurred in the per cent salaries and wages in each of those three years.

Mr. Deputy Chairman: All those in favour of the amendment will please say “aye.”

Those opposed will please say “nay.”

In my opinion the nays have it.

Amendment stacked.

On section 5:

Mr. Bounsall: An amendment on section 5(1) --

Hon. B. Stephenson: Which amendment are you using, yours or Mr. Laughren’s?

Mr. Bounsall: Mine. Mr. Laughren will be here to move his when the time comes.

Mr. Deputy Chairman: Mr. Bounsall has moved that in section 5(1) of the bill, all of the words following “amended” in line three be deleted and the following substituted therefor: “by striking out all the words following ‘remunerated’ in the amendment of 1975 and substituting therefor, ‘and there shall be no maximum rate.’”

Mr. Bounsall: The effect of this amendment is very clear. This is the part of the act which deals with the maximums allowable in earnings of workers on which compensation can be considered and paid. It is, of course, 75 per cent of that. We in this party feel very strongly that there should be no maximum upper level on which compensation and, therefore, pensions via the pension-rating method should be based. There should be absolutely no maximums at all.

The great number of workers who are injured in the work place do not make anything near the $15,000 as indicated as the current maximum. Maybe the board has figures on that, as to what the breakdown is on maximum earnings. I thought I had a document fairly recently in my files which indicated that breakdown by the salaries of those workers who are receiving either compensation or pension benefits at the time of the accident. I am not able this morning to come up with it. I thought I had it, but perhaps the board or the minister could give some indication of just what that breakdown is.

In this matter of increasing the maximums, we’re not talking about a very large number of workers; and the principle is that there should be no maximum. If a worker is deprived of his employment in the work place through an accident injury, the whole purpose of the act is to compensate those workers for that loss of income. The fact that we have a factor on it that they would receive 75 per cent of their benefits as non-taxable is not a bad deal when we get to those workers at the upper level, or over the current upper level. I have already suggested to the minister that perhaps there should be some sort of sliding scale in terms of what percentage is given of that non-taxable amount, because workers at that higher level do benefit by the non-taxable portion of that 75 per cent. Perhaps that 75 per cent could be even a smaller percentage for those persons, taking into account the tax which they paid. But clearly there should be no upper maximum whatsoever.

Let me make one final comment. Away back in 1975, when we were dealing with these amendments, one of the arguments made by some of us during the debate, and informally outside the House, was that the maximum should at least be equal to the salary which an MPP makes. We were quite agreeably surprised, after some consultations had taken place before the bill was introduced, when it was raised from $12,000 to $15,000. It appeared to many of us that the argument that it should be at least the salary of an MPP at $15,000 was reasonable anti it was accepted. Those salaries have now gone to $20,000. If there is to be a maximum placed in the bill, at least following that philosophy in other years it should be $20,000.

The major point is that there simply should not be a maximum upper limit on which compensation can be paid; and subsequently, if there is a permanent partial disability still remaining, that permanent partial disability, when paid, should be geared to those average earnings of that worker irrespective of how high or how low those average earnings are, except for someone who is working and making well below the minimum wage and needs to have the minimum provisions of the bill applied to him.

In spite of what the Wyatt report recommends, I would hope that this minister, in the first time that she has been before us taking a Workmen’s Compensation Board bill through, would see her way clear to accepting the principle that there should be no maximum rate on which compensation should be calculated.

Hon. B. Stephenson: I think I have made all of the comments that really need to be made about the removal of a maximum for workmen’s compensation benefits earlier during the second stage debate. Certainly removing the maximum is going to impede the possibility of moving in the direction of a universal insurance program, but I would remind the honourable members there is a very strong recommendation in the Wyatt report that the maximum not be increased at all at this point. We have moved to 125 per cent of the average industrial wage in the province, which it seems to me is a reasonable level for this point. I would hope that that maximum could remain in this bill for the time being until we have examined the rest of the report.

Mr. Bounsall: I have just a point, mechanistically, before we move any further, speaking to the point of how we operate. It might appear that when it comes to a vote, although one always hopes that one’s amendment would carry, that this amendment might stand a slight chance of being defeated. I am trying to gather the flavour of the House. If that is the case, my colleague, the member for Nickel Belt (Mr. Laughren) has a second amendment at this point. The normal procedure here, rather than stack this amendment, would be to take a vote on it now. If a method could be found, however, by which he could place his amendment and still have it stacked without taking a vote on it now so that it could all be done at the same time, I presume that members of the House would be appreciative of that. I leave that in the Chairman’s capable hands.

[2:00]

Mr. Deputy Chairman: I would point out to the member for Windsor-Sandwich that under normal circumstances if his vote is stacked, we could not take another amendment on the same section. However, with the unanimous consent of the committee of the whole at this time we could do it.

All those in favour of Mr. Bounsall’s amendment will please say “aye.”

Those opposed will please say “nay.”

In my opinion the nays have it.

Shall this vote be stacked?

Mr. Bounsall: It will be stacked on the assumption that we have unanimous consent.

Mr. Deputy Chairman: Is there unanimous consent that another amendment can be placed to this clause?

Hon. B. Stephenson: Mr. Chairman, the other amendment is very similar in effect.

Mr. Bounsall: No.

Hon. B. Stephenson: Wait a minute. No, it isn’t. Pardon me. It has the same effect, mind you.

Mr. Deputy Chairman: If I do not get unanimous consent, I will have to call in the members.

Is there unanimous consent?

Some hon. members: Agreed.

Amendment stacked.

Mr. Deputy Chairman: Mr. Laughren moves that in section 5(1) of the bill all the words following “amended” in line three be deleted and the following substitute therefor:

“by striking out ‘$15,000’ per annum in the amendment of 1975 and substituting therefor:

“(a) $16,800 effective July 1, 1976;

“(b) $18,500 effective July 1, 1977; and

“(c) $19,600 effective July 1, 1978

“and the amounts indicated in this section shall be adjusted on July 1 in each succeeding year, commencing with July 1, 1979, by the higher of either the same percentage increase granted in subsection 8(c) of section 42 or by appropriate increments of $1,000 when claims data revealed by December 31 of the previous year that 10 per cent or more of workers have earnings that exceed the maximum rate.

Mr. Laughren: I will be very brief, Mr. Chairman. This is based on the model used in Saskatchewan; so we know it works and we know it works well.

Very simply, what it does -- to put it in layperson’s language -- is it says that what’s preferable to establishing an arbitrary maximum is to have it so that any time more than 10 per cent of claims are in excess of the existing ceiling, the ceiling would be bumped up in $1,000 increments. That is a very nice way of doing it. It’s very neat. It takes the decision-making on levels out of the political arena and makes it automatic. It still allows

-- which should make the minister happy -- for the five, six, seven, eight or nine per cent of people who earn extremely high incomes not to be earning exceptionally high levels on compensation.

Hon. B. Stephenson: In an inflationary period it could get --

Mr. Laughren: All I’m saying is that it’s a very nice way of making it an automatic increase and having less than 10 per cent at all times earning above the ceiling.

I don’t think the minister knows what percentage will be above the ceiling of $16,200. I don’t think she’s any idea. If she has, I’d sure like to know.

Hon. B. Stephenson: It can be estimated on the basis of 125 per cent.

Mr. Deputy Chairman: Order.

Mr. Laughren: Yes, but the minister doesn’t know, that’s the point. She can guesstimate it. But that’s something we should know: to what extent certain workers are being excluded.

We know, for example, that there are bonus miners, construction workers and so on, who earn considerably in excess of $16,200. They just happen to be in areas of work where there are high accident rates. I would urge the members to accept this most reasonable amendment.

Mr. McClellan: I simply want to say that the existing ceiling is inadequate to cover and protect construction workers. That’s a simple fact; that’s a simple reality. I simply want to point that out. As far as I’m concerned, nothing shows the discriminatory nature of workmen’s compensation levels more than the imposition of an earnings ceiling which is substantially below what workers actually earn. We are seeking in this amendment to eliminate that discrepancy, that injustice, that class bias in the legislation. I doubt if there is any legislation with respect to pensions affecting professional groups that would incorporate such enormous discrepancies between actual income and insured income, yet we have a Workmen’s Compensation Act pension that is grotesquely below the level of actual earnings.

Hon. B. Stephenson: To my knowledge, it is not grotesquely below the average level of earnings. In fact, the vast majority, something over 70 per cent of those who are presently receiving benefits from the Workmen’s Compensation Board, would be below the ceiling which is established.

Mr. Deputy Chairman: Those in favour of Mr. Laughren’s amendment please say “aye.”

Those opposed please say “nay.”

In my opinion the nays have it.

Amendment stacked.

Mr. Deputy Chairman: Mr. Bounsall moves that subsection 2 of section 5 of the bill be amended by deleting in lines two and three the words “on or after the first day of July, 1978 but does not” and substituting therefor, “after the effective dates and nothing therein entitles any person to claim additional compensation for any period prior to the effective dates and does”; and deleting all the words following “act” in the seventh line.

Mr. Bounsall: This amendment is predicated on the fact that subsection 5(1) will carry in the form that the member for Nickel Belt has moved, and that we would then need to change subsection 5(2), as has been done in other parts of the bill when there has been a yearly change, which allows for the change to occur in each one of those particular years, and also would have to have removed from subsection 5(2) the last two and a half lines so that it can be paid out prior to and be eligible for the payment out prior to that first day of July 1978.

Of course, the reasons and the purpose behind this amendment are very obvious, but I just might say in addition that this whole maximum or maximums not brought into line with at least those increases that have been granted to the permanent partial disability pensions is really causing some concern in terms of who will, in fact, be eligible -- those who are already on pension -- to be able to receive those full amounts even granted by the minister a cumulative total of 27 per cent.

Not only do we need a higher maximum, and this helps to put those different maximums as suggested into place and those payments made, we need those very much because certain workers will be disadvantaged in not being able to get those percentage increases as outlined in section 3 of the bill. I certainly hope that 5(1) carries, bringing forth these necessary amendment changes in 5(2).

Mr. Deputy Chairman: Those in favour of Mr. Bounsall’s amendment please say “aye.”

Those opposed please say “nay.”

In my opinion the nays have it.

Amendment stacked.

On section 6:

Mr. Deputy Chairman: Mr. Bounsall moves that in subsection 1 of section 6 of the bill clause (b) of subsection 3 of section 51 of the act be amended by, in line 1, deleting $192 and substituting therefor $219; and in line 6, deleting $96 and substituting therefor $110.

Mr. Bounsall: Here again, on this amendment, I can find no rationale for the number changes of the ministry in this section. We needn’t proceed with the amendment if I can find from the minister a good rationale for these number changes.

The change from what was in the act previously to the $192 clothing allowance in the bill is a 15 per cent increase over that three-year period. The later change to $96 from what was previously in the act set three years ago represents a 14 per cent change only. I did what I could do to find out whether or not the clothing component of the cost of living change cumulatively over those three years came to, in the first instance, 15 per cent and in the second instance, 14 per cent.

This was not the cumulative clothing part only of the consumer price index over those three years. Therefore if it wasn’t directly tied to those clothing increases, which is what this amendment speaks to, why did we not have your figures for the other changes that occurred in the bill -- a cumulative total of roughly 27 per cent applied to what was in the act before -- rather than the 15 and 14 here?

My amendment simply reflects that same percentage which has been used throughout the rest of the bill. It applies to both the amounts that could be paid out in clothing allowance, for lower limb prosthesis and back brace problems and the maximums for the clothing allowance with upper limb prosthesis situations and so on. I wonder why we haven’t got the 27 per cent. My calculations make it those figures. If you have a very good reason I would like to hear it. But otherwise why not accept the consistent percentage change you have made throughout?

Hon. B. Stephenson: It is my understanding that the recommendation for this percentage change in regard to the clothing allowance was the recommendation of the joint consultative committee on the basis of their investigations -- the study they have done in this area and their personal knowledge of the situation as well. The recommendation I gather was accepted in toto by the board and then recommended to me. I accepted their figure because they had done the study.

Mr. McClellan: What was the study? That doesn’t tell us anything.

Hon. B. Stephenson: I don’t have the background information.

Mr. McClellan: You don’t know?

Mr. Chairman: Does the member for Windsor-Sandwich want to reply to this?

Mr. Bounsall: Yes, if I could. It’s too bad this didn’t occur in section 1 of the bill so that we would have time for the minister to put the questions back down the line and have it come back up as to why this lower-than-what-would-be-expected percentage change was occurring.

Mr. McClellan: They are cheap.

Mr. Bounsall: It is really a small amount we are dealing with. I am guessing but it is not my impression that everyone with these clothing problems as related to prosthesis comes and gets a complete clothing allowance each year. They usually have to apply for it, the situation is looked at and decided upon. I am sure we are not dealing with 100 per cent of the people who would be eligible for this. It doesn’t take very much to increase it. It is the same type of ad hoc-ery again, if there is no explanation for it, which is really an affront.

Hon. B. Stephenson: I am simply saying I don’t have the explanation, but they had one.

Mr. Bounsall: The minister should really get it if she can get it quickly. We could probably talk about section 9 of the act meanwhile, if that could be obtained.

Hon. B. Stephenson: No, no. I would be perfectly happy to go along with your amendment, as a matter of fact.

Mr. Bounsall: Oh fine, thank you.

Mr. Haggerty: I would like to speak on the amendment. I don’t quite agree with the amendment as presented by the member.

I don’t think the problem lies in additional benefits given to recipients of workmen’s compensation to pay for repairs to clothing and so forth. I think the need is for quicker approval to have braces repaired and to be replaced with new ones. Perhaps it applies to other areas of the body too.

[2:15]

I am well aware that in some cases the board moves with the speed of a snail, and if they went any slower they would be motionless. I suggest that is the area that should be corrected. I can cite cases where doctors have suggested a new brace for the claimant, but for some unknown reason it is six or seven months before any response comes from the Workmen’s Compensation Board. I suggest to the members sitting under the gallery over here that they take my remarks most seriously. I think this is an area that they can move in, and perhaps with very little cost to the Workmen’s Compensation Board.

Mr. McClellan: Mr. Chairman, before you go on, did I understand the minister to say she was accepting the amendment?

Hon. B. Stephenson: Yes, I can’t see any reason for not accepting it.

Mr. Laughren: That’s encouraging.

Motion agreed to.

Section 6, as amended, agreed to.

Sections 7 to 9, inclusive, agreed to.

MENTAL HEALTH ACT

Consideration of Bill 19, an Act to amend the Mental Health Act.

On section 1:

Mr. Nixon: The Mental Health Act has had an extensive review in the presence of the minister and the staff by one of the standing committees. One of the highlights of the review of the bill had to do with certain definitions which divided the committee. As nearly as I can tell, they even divided the representatives of the three parties to some extent.

I am informed that the member for York East (Mr. Elgie) had put forward an amendment --

Mr. Bradley: A good man.

Mr. Nixon: -- which had, in some sense at least, continued the concepts for the requirements for committal that had been accepted by the community. I understand also the minister had taken a very strong stand on what might have been called an individual civil libertarian basis which was commended and supported by some members of the committee -- as a matter of fact, a majority. It is not usual for a bill that has had a thorough review by a standing committee to come before the committee of the whole House unless there are some members in the House who feel that the matter should be settled by the House meeting as a committee of the whole.

That is the case in this instance. It is for that reason that when the bill was reported back from committee it had a reference to this standing committee at my request as the House leader of the Liberal Party.

The amendment we want to put is not to section 1 but I felt it was worthwhile raising it at this time, for probably a very obvious reason. I felt it would give the House an opportunity to reconsider a decision that was made in committee. It could be that the same decision would be reacted. But at least the House would have an opportunity, particularly since some members have had a great deal of mail on this bill and on this section, for a last chance to express their view. I hope they would reverse the decision taken by the minister and supported by the committee on division. I would point out again that it was a division that did not go along party lines basically -- that there was division in each one of the caucuses.

The matter is of great importance, and because of that my colleague and leader has set aside a great deal of important business so that he would be able to give all of us as members of the House the benefit of his views.

Mr. Eaton: Good stall, Bob.

Section 1 agreed to.

Section 2 agreed to.

On section 3:

Mr. S. Smith: I was tempted to stand outside the chamber and allow my colleague from Brant-Oxford-Norfolk --

Mr. Eaton: To see how long he could go on.

Mr. S. Smith: -- to continue to expound on this bill which I know is of very profound interest to him and on which he has spent hours and hours of study and research.

Mr. Eaton: He did better on that than you were doing on agriculture.

Mr. S. Smith: I have had the opportunity to speak to this bill on second reading. I think if members would refer to my words at that time, they would find that I spoke partly, of course, as a member of this House, honoured to have been elected from a constituency, and partly in my previous role, before political life, as a psychiatrist. There is no conflict of interest or anything of this kind in speaking from both those roles because certainly there is no money to be made by amending this bill one way or another. There is no way that one’s professional prestige would be enhanced or harmed. It’s simply a question of wishing to share with this House some of my feelings based on the years of experience I have had and the many opportunities I have had to operate within the confines of the Mental Health Act as it presently exists.

I feel that the change being brought about in this particular amendment suggested by the minister with regard to section 3, wherein section 8 of the Mental Health Act is being amended, is something we should consider very seriously, particularly in view of the fact that we have already agreed that as part of this bill we have shortened the time necessary for a person to obtain a review of his involuntary status.

It used to be that a person would have 30 days before he could have a hearing, whereas now, thanks to what I think is a progressive move on the part of the minister, that is to be very much shortened; now a person will be able to have a hearing within five days. To some extent, therefore, there is a slight decrease in the degree of pressure that we should feel to change the provisions in the act which determine the criteria for involuntary admission; and to some extent, therefore, since the appeal procedure is so quick and the remedy so obvious, it seems to me that the need to be certain that the net is not being cast too widely, so to speak, has been lessened in intensity. Therefore, we can stop for a moment to reflect on whether there is a real necessity to make a change in the criteria now being applied.

The amendment basically confines the in- voluntary admission to those situations where a person is felt to be in some physical danger himself due to his illness or that some other person will be in physical danger due to the illness; and it seems to me that unnecessarily restricts the meaning of mental health; it unnecessarily restricts the usefulness of involuntary admission. I believe it will have a very deleterious and serious negative effect on society, very much the opposite of what the minister expects. It’s my view that most situations that have arisen over the last several years in terms of complaints, possible abuses or lawsuits, and one thing and another, have related to situations where psychiatrists have failed to keep someone in against his or her will and where the results of that failure have been disastrous.

One does not wish, therefore, to create an atmosphere where psychiatrists will be very much more hesitant in admitting people for proper treatment. Surely one wants to create a situation where a psychiatrist will take the responsibility which society has placed upon him, a responsibility which nobody enjoys having. We want a situation where he or she will take that responsibility with greater ease rather than with enormous fear and trepidation.

I think, particularly, of situations where continued mental illness without proper treatment will lead to something other than just physical harm. I think of situations where the entire development of a child could be very badly affected by having a seriously disturbed mentally ill person, so mentally ill as not to realize the need for treatment, continue to act in close proximity to the child. I think of situations where the resources of the family can be squandered and the reputation of the family and of the individual can be ruined. I think of places where their hopes for the future, their careers and the possibility of their employment can be destroyed by continuing to be untreated. I’ve had so many experiences where, having treated persons in this state, shortly after treatment they are extremely grateful, and very thankful and realize their complete lack of insight, which was part of the illness and which led them, at first, to resist the treatment making the involuntary admission necessary.

I think of instances where young people have ended their lives and where it was not possible really to predict that that is what would have happened. It was not possible really to say that that was the physical danger that was imminent and yet one knew that there was a very serious disturbance in which the person had no insight, but where one could not genuinely predict that there was a risk to life and limb although there was obviously a serious mental disorder which required treatment.

I believe it’s very important, as I say, since we have shortened the review period, which I think is the most important provision of this bill, not to act in haste and not necessarily to constrict the way in which treatment is being given in Ontario, but to allow the process of these reviews under the new act, as the amendments will carry, to go on for a little while and to see whether in the course of these much more frequent and much earlier reviews there are abuses found in which psychiatrists have unnecessarily put people in hospital against their will.

If we find there is a lot of abuse of this kind, then I think we could move to tighten up the criteria. But nothing has indicated to me that this has been a serious matter of practice in Ontario. In the Soviet Union, there have been people committed to mental institutions for political reasons but rarely, if ever, have there been instances of serious abuse in Ontario of people admitted against their will. Frankly, where they have occurred -- and I know of some -- it seems to me the real problem was it took them 30 days to get a hearing.

Now that the minister has removed that grave injustice, even though there is no one in the province of Ontario any stronger for civil liberties and human rights than I am, since I’ve stood up in this House on a number of occasions to take a number of stands which are not popular at the moment, I believe very deeply that we will end up actually doing more harm to people by tightening these criteria than we would be doing good for people. I would, therefore, ask that the minister consider agreeing with me that the shortened period of review and the need for a second opinion should be allowed to stand by themselves for some time and to be in practice for some time and that we put to the side the need for revising the criteria which, I believe frankly, could wait until we see how things go with the revised review procedure.

[2:30]

Where a doctor may be tempted to admit someone without proper grounds, he will be somewhat restrained by knowing that within a few days another colleague will be looking at the matter and that within a few days he will have to justify his decision. That’s very different from a situation where it was 30 days and the case was probably long done with by the time anybody got around to thinking about it. So there’s already a protection being built in here, for which I commend the minister; I feel, therefore, that it’s excessive and, in my view, somewhat dangerous to change the criteria.

Therefore, I would move an amendment to section 3 of bill 19, amending section 8(1) of the Mental Health Act. I may just say parenthetically that the amendment I am about to present is the amendment from the Ontario Council of Health. It’s an amendment which I gather my colleague from Renfrew North (Mr. Conway) at one point presented briefly in the committee but, when faced with what he thought was a threat to withdraw the bill should such an amendment pass --

Mr. Nixon: Threat to withdraw?

Mr. S. Smith: Well, I say what he thought was a threat. It may or may not have been. I don’t wish to be unfair to the minister. At that point, he withdrew the amendment but I wish to put it now.

I will draw my remarks to a close by saying that I sincerely hope this amendment will carry, keeping in mind that we can always change the criteria once we have had a little experience with the newly toughened review procedures and that one would not wish to cause psychiatrists to be too hesitant to apply treatment to those who would otherwise be in imminent danger other than just physical danger.

Mr. Chairman: Mr. S. Smith moves that section 3 of the bill be amended by deleting section 8(1) of the act and substituting the following therefor:

“8(1) Where a physician examines a person and the physician is of the opinion that the person is apparently suffering from a mental disorder of a nature or quality that requires immediate hospitalization in order to prevent (a) serious harm to the mental or physical condition of such person or (b) serious harm to the mental or physical condition of another person and such person is not suitable for admission as an informal patient, the physician may make application in the prescribed form for a psychiatric assessment of the person.”

Mr. Breaugh: Mr. Chairman, the matter of the substance of the amendment as proposed was a matter of considerable debate; in fact, it was the centre of the debate during the committee proceedings. It’s true, as the member for Brant-Oxford-Norfolk pointed out, the matter was a rather contentious one because the bill focuses on this set of criteria. On this is built the review period and the review mechanism, and this is a substantive alteration from the current Mental Health Act.

It was, I might say, not simply a matter of discussion and contention during the three weeks or so of committee work that was done but has been discussed for some time previously, because the main set of criteria that is proposed in the act has been well known throughout the province for a considerable number of months, and at least in my office it has been the centre of a great deal of discussion and representation from virtually all interest groups that could conceivably be involved in this Mental Health Act.

It’s also true, I think, to agree that there is a group of people who do not want this criterion narrowed, and that turns out to be essentially the professionals working in the field, psychiatrists mostly. In some instances some members of the law society are a little upset with it as well. It does certainly restrict their -- I hesitate to use the word “freedom,” but their ability and responsibility to enact their professional judgement in a larger area. It confines that. It makes the criteria much more specific than this amendment proposes.

During the course of listening to representations from several people, from patients, from people who are interested in mental health, from mental health organizations, and from people who work in mental health institutions, it becomes apparent that there are some abuses of the current Mental Health Act. If we don’t want to use the term abuses, then we certainly have to accept that there is some confusion about what precisely we mean by safety or harm or serious harm, as used in this particular amendment, and to question whether that in itself isn’t causing a great many problems. There is no certainty applied by the law.

We get to the basic position as legislators that we are not here to act in a professional capacity as psychiatrists. But we are here certainly to represent the society in which we live and to say that under certain sets of circumstances we will withdraw, not just some but virtually all the rights that some other member of our society might have. That is an extremely serious thing.

I wouldn’t run the gamut and say the thing is abused in a political sense. I don’t think that’s true. I don’t think it is consciously abused by professionals working in the field either, but I do think there is a great deal of confusion surrounding the interpretation of the present criteria and that they would be made much more difficult by the ones proposed in this amendment.

At the end of the committee session, I think that we did have consensus, even from the Liberal members of the committee who, at that time, proposed a similar amendment during the course of the committee hearings. Because it becomes evident that as we broaden the criteria, as we move into words such as are used here, “serious harm,” for instance, it becomes hazier and hazier. We begin to make value judgements, not on someone’s physical and mental wellbeing, but on their lifestyle and how they choose to dress, how they choose to act and how they choose to relate to those around them.

It soon becomes a clear indication that it causes confusion in itself and it is not operable. One can’t work under those circumstances. Each time someone proposed an amendment -- and there were amendments proposed by both Conservative and Liberal members of the committee -- each time this was done, when what those amendments would mean were discussed and examined, we got into grey areas that would cause eventual difficulties. The committee kept reverting to the original words proposed by the minister in this section, and I think for good reason.

We go back to those, because in order to make that judgement and to make it clear and without argument, we need to have a severely restricted set of criteria, as laid down in the original proposal by the minister. That does cause difficulty for some people working in the professional field. The minister responded during the course of the hearings that there were other acts that should and can be applied. They are not now used. The blanket wording that is in the present Mental Health Act is used for safety.

I confess openly and honestly to all concerned that it was a matter of some considerable contention within our own caucus. We heard representation from patients, from people who work in the field of mental health and from the professionals who are involved. There are differing opinions. What we came to in the end is that society has to make some kind of a value judgement and come to a consensus that says, “Under this very limited set of conditions, we are prepared to say that certain people need to have their rights taken away from them. But we want that set of conditions to be extremely narrow in scope. We do not want them to be open even to the most conscientious psychiatrist to make his or her personal value judgement on a patient.”

We support the original proposition that is included in Bill 19. We support it because once you get off that position you get yourself into great difficulty. We do not impugn the motives of professionals working in the field. We are simply saying that as legislators we are prepared to say to a segment of our society: “For your own good and the good of those around you, you may need to be involuntarily committed.” But we are also saying that the scope of that kind of treatment should be extremely narrow and that other acts should be used if they need to be used. The government should not provide in legislation a confusing and rather broad set of criteria for this definition.

We will not support the amendment. We do appreciate the spirit in which it was given, because that was evident during the course of the committee hearings and, I think, in almost every representation that was made to me. There are a few people in our society who think that this is a simplistic problem; it is a very difficult one. But it needs strict sets of criteria as proposed in this act.

Frankly, the remainder of the revisions to the Mental Health Act that are carried out in Bill 19 are dependent upon a severe and limited set of criteria. The time period, in my view, will not work if we change the criteria, nor will the review board mechanisms that have been put in place be nearly as effective if you broaden these criteria because this is one act that hangs together. There is a good deal of interdependence from one section to the other.

So, in summary, we appreciate the intent put forward in this amendment and we understand the seriousness of the problem, but that is compounded even more should you accept this amendment, and we will not support it. We will support the criteria that were put forth in the original Bill 19.

Mr. Bradley: Speaking very briefly to this, Mr. Chairman, in the interests of the time confinements we have this afternoon, I would speak in support of the amendment put forward by the leader of the official opposition.

Certainly, in my own experience with the representations that have been made to me as a member of the provincial Legislature and previous to that as a member of a municipal council, in dealing with people on an individual basis there are many people within my constituency who felt -- as odd as it may sound to the minister and others who are very much in favour of this bill -- that the criteria that presently exist before the passing of this bill were in some cases inadequate to deal with problems they had within their own families.

I have not, from my own constituency, had more than one representation made indicating there was a serious abuse of this or that the appeal mechanism which presently exists was inadequate. As the Leader of the Opposition has pointed out, even the narrowing of the definition is serious in itself, but it is much more serious when coupled with the reduction in the number of days in which involuntary confinement can take place without a second opinion.

The opposition which has been shown by members of the medical profession, by the Ontario Medical Association, by psychiatrists, by those who had the responsibility of delivering psychiatric services in the province of Ontario, is a clear indication from people who are experts in the field that there is great concern about the proposals contained within this act and it is a concern which I think would be alleviated to a certain extent by the amendment as proposed by the Leader of the Opposition.

I note also that a gentleman who was held in a good deal of repute by my friends to the left for a number of years as a member of this Legislature, Dr. Morton Shulman, wrote an article on May 9, 1978, in the Toronto Sun indicating his grave concern about this particular bill and expressing the hope that members of the Legislature would not proceed with it to its fruition.

I would also mention another individual who is, I think, held in a great deal of repute by all members of this House -- I refer to the member for York East (Mr. Elgie) who has expressed grave reservations and who, indeed, was instrumental in dealing with an amendment which would, I think, have improved the bill from what it is at the present time.

Taking into consideration the representations made by these people of reputation, by people who are very respected, and taking into consideration the fact that at the present time in the province of Ontario we have some difficulty expressed by families who have individuals who obviously require psychiatric care but are not compelled to receive that psychiatric care, I would strongly recommend to the House the support of this particular amendment.

Hon. Mr. Timbrell: I will try to be brief. May I first of all start off by saying the committee process in which we all took part was one of the least partisan, most interesting, most productive sessions that I have participated in in the seven years that I have been a member of this assembly.

As has already been pointed out by several of the earlier speakers, on this particular matter it was one that really wasn’t bound by party lines at all. There were, in fact, expressions pro and con in all three caucuses.

[2:45]

I may say, as well, this is a subject to which I have given a great deal of thought and about which I have had a great deal of concern for some time. In proposing legislation of this kind one is very mindful of the kinds of things that are said and have been said, for instance, by the Leader of the Opposition, that perhaps what we’re doing in trying to cure a situation is prescribing a remedy that is worse. One is always mindful of that.

I was persuaded, in evaluating the Mental Health Act, that there were certain areas in which I had to act as soon as possible rather than wait for the conclusion of the work of the Ontario Council of Health task force on the Mental Health Act and mental health services, which report may well be as much as a year or two years away.

There were a number of items that were recommended to me by my staff and which we reviewed in determining what would go first into Bill 124 and then into Bill 19 which I determined could wait and about which, frankly, I wasn’t prepared to take a position at this time, one way or another, on a variety of things. This is one I felt very strongly had to be addressed at this time.

It concerns me that a number of the arguments which are advanced by my friend the Leader of the Opposition, and which I have seen advanced in a number of the letters I have received, centre on a couple of arguments, namely, those to do with financial loss, embarrassment to the family and so forth. I have received about 1,200 letters on this subject -- admittedly, mostly from doctors and mostly expressing concern about the bill. I have replied to those 1,200 letters now, and we’re starting to get letters back from some saying they now understand what we’re trying to do and they support it. I don’t expect that will be universal.

It concerns me when I hear some of these arguments about financial loss and these other things, because if one looks at the present act and at the present criteria, which revolve around the question of safety, I have some considerable difficulty accepting the notion that one could construe safety to mean the squandering of one’s personal finances: that one could construe safety to mean the loss of a professional reputation or the damaging of a professional reputation.

In looking at those arguments, I had to go back in my mind -- and I did -- to review why we had decided to put this into Bill 124 in the first place. It really goes back to about 1975 when the ministry, through an outside consultant and then internally, started to poll the people in our psychiatric hospitals, who after all, have to live with the Mental Health Act to find out what problems there were with the act itself. Not everyone made comments and not everyone made this comment, but the most frequently heard comment was that the criteria for involuntary committal under section 8 of the Mental Health Act were too vague and they had to be clarified.

That leads to another concern I have with some of the arguments advanced opposite. It’s not a question of trying to cut down on the number of involuntary admissions. It’s not a question of trying to increase the number of involuntary admissions. It’s not a narrowing or a broadening which we seek, but a clarification. I suppose that’s the principal concern I have with the proposed amendment: it is not clear, it is vague; it is very broad, perhaps even broader than the present criteria of the Mental Health Act.

It seems to me that we as legislators, on a subject as important as the deprivation of personal liberty, owe it to the people of this province and to the people who must make this act work, to speak clearly, and that is the purpose of Bill 19, the purpose of section 3 in particular.

It has been suggested that the only way that persons are going to find themselves committed involuntarily now is if they have, in fact, committed an overt physical act. That again, I submit to you, is a misunderstanding, perhaps an understandable misunderstanding if I can put it that way, of the way section 3 of the amended section 8 is set out. For whatever reason, those who read that section and decide to oppose it never seem to get to subsection (c), where it talks about a person having shown or showing a lack of competence to care for himself and then going on to ask the physician to form an opinion -- not a firm prediction, an opinion, a medical judgement -- that the person is “apparently suffering from a mental disorder of a nature or quality that likely will result,” and then it goes on from there.

I’ve had the argument advanced to me by some on other sides that section 8, subsection (e) is, in fact, too broad, but it is there to provide for medical judgement. It is there to provide for the individual physician -- and let’s not forget that we’re not talking about psychiatrists for the most part when we talk about section 8. We are talking for the most part about family practitioners, who will only deal with this kind of a problem very infrequently in any given year and for whose benefit, I suggest again, we must speak clearly. It is there to provide for that family physician or to provide for that psychiatrist the latitude for a professional judgement within these very clear criteria.

The final thing I want to mention has to do with the notion that this is somehow a civil libertarian bill, as opposed to what, I don’t know. I have never, from the beginning of the process, professed to represent either the medical point of view or the civil libertarian point of view. Rather, as a layman who happens at this time to be the Minister of Health, I have had to evaluate the situation from the point of view of a concerned citizen, a representative of the people, and consider how I would want myself, my family, my constituents to be dealt with in this very significant area. It is, instead, a very sincere effort on my part and on the part of the government to speak clearly to the profession, in fact, to assist the profession to make proper judgements of who should or should not be deprived of their liberty for whatever period of time.

I understand the argument advanced by my friend from Hamilton West about leaving this alone because we’ve reduced the period of initial confinement. I suggest to you, sir, that if the review process is to work properly, whatever the period of initial confinement, then the criteria for first admission and the criteria for the review of whether that person should be detained longer must again be clear. An improved review process is really no improvement at all if the criteria are vague, and we serve no one whom we seek to serve if we leave it in that way.

One final point I would make is, recognizing the concerns of members opposite and people beyond this building, in committee I mentioned, and I repeat this commitment, that we will track very carefully, through whatever research means possible, the best possible, the application of the revised criteria.

Mr. S. Smith: The number of psychiatrists in Ontario, too.

Hon. Mr. Timbrell: Mr. Chairman, with respect, and I don’t want to get partisan because none of the discussion on this has become partisan, but the honourable member makes that kind of an observation which would lead one to believe that the present criteria are somehow all-inclusive; that one can stop any eventuality, any tragedy, with the present criteria, and clearly that’s not so.

Mr. S. Smith: Of course not.

Hon. Mr. Timbrell: I hope the House will see fit not to accept the amendment. I can assure members that we will track this very closely. I am confident that this is not going to inhibit medical judgement. I am confident that this, in fact, will be an assist in making a medical judgement as to what we as legislators, as representatives of the province and of society, intend should be the proper use of the right to take away someone’s liberty and commit that person to a psychiatric facility.

Mr. S. Smith: Let it be on your head.

Mr. Sweeney: Are we still on the same amendment, Mr. Chairman?

Mr. Chairman: That’s the amendment that is before the committee.

Mr. Sweeney: I think the minister knows quite well the position that I took in committee on this particular amendment. I sense very clearly from what he has just said the position he is taking. I must reiterate two points, however.

The first point relates to the minister’s rather frequent reference to the word “clarification.” I must remind the minister that on several occasions during the committee hearings, the minister himself posed to the witnesses that the existing definition of the word “safety” in the present act, in his judgement, would not allow physicians or psychiatrists, as the case may be, to involuntarily commit people for a number of purposes which he described. I am not going to go through them all; the minister knows what I am talking about. But I ask the minister to please remember that, time and time again, those witnesses told him that he was wrong; that, under the old definition, they could commit --

Hon. Mr. Timbrell: Mr. Chairman, on a point of order: If the honourable member will check Hansard, what I did on a number of occasions was to ask them how they defined safety to include a variety of situations, because again it seems to me the word “safety” is so vague that it does need clarifying. That’s what I did. It was not to challenge but rather to ask them to explain how, for the edification of the committee, they used “safety” to cover a pretty broad field.

Mr. Chairman: That sounds like a point of privilege.

Mr. Sweeney: Very well, if the minister wants to put it in those words. The point I am trying to make is that the difference between the minister’s understanding of how safety should be interpreted and how, in fact, it was being interpreted, was rather great. I think that’s an important point. I raise that only because, in my judgement, the version we now have goes far beyond just clarifying what was there before. As a matter of fact, I would suggest that we have gone from one extreme to the other. The present bill, as we heard in the committee, allows for a wide interpretation. In this bill we are narrowing the present interpretation down to a point where we are going to severely limit the possibility of physicians -- and remember we’re talking about skilled, trained, competent physicians -- to make a medical judgement.

The second point I want to make is that by narrowing it down to bodily injury, we are raising once again the spectre of associating mental illness with physical violence. I think that’s a mistake.

Thirdly, by not recognizing that a mentally ill person can do far more damage to another person in a mental or an emotional way than he can in a physical way, we are refusing to recognize the kind of damage that can be done. As my colleague from Renfrew North pointed out in the committee, we are simply going to exchange one group of victims for another. I would suggest that’s not a very good exchange, and earnestly urge the minister to consider the amendment put forward by my leader.

Mr. Chairman: Any further comments on this amendment?

All those in favour will say “aye.”

All those opposed will say “nay.”

In my opinion the nays have it.

Amendment stacked.

Mr. Chairman: Are there any further comments, questions or amendments to any other section of the bill?

Mr. S. Smith: A terrible step backward. Who persuaded you to do this?

Sections 4 to 21, inclusive, agreed to.

Mr. Chairman: I would inform the committee that we have three bills before the committee. There are a number of votes that have been stacked. The bells will ring for up to 10 minutes.

CROWN TIMBER AMENDMENT ACT (CONCLUDED)

Mr. Chairman: The first vote is on Bill 35, An Act to amend the Crown Timber Act. It has been moved by Mr. Foulds that section 4 of the bill renumbered as section 5 be amended by adding thereto the following subsections:

“(2) On or after the first day of July 1979 where a regulation is made under clauses (c) or (d) of subsection 1, the minister shall, within 15 days after the regulation is filed with the registrar of regulations, lay a copy of the regulation before the assembly if it is in session or, if not, within 15 days after the commencement of the next ensuing session and the assembly shall by resolution approve or amend the regulation.

“(3) An approval of a regulation by a resolution under subsection 2 is effective from the day that the regulation came into force.

“(4) An amendment to a regulation by a resolution under subsection 2 is effective from the day that the regulation came into force or from such other day thereafter that the assembly may specify in the resolution.

“(5) Where a regulation is amended by a resolution under subsection 2 the Lieutenant Governor in Council shall give effect to the resolution by making an amending regulation in accordance with the resolution and such amending regulation need not be laid before the assembly.”

The committee divided on Mr. Foulds’ amendment to section 4 of the bill, which was negatived on the following vote:

Ayes 18; nays 37.

Section 4 agreed to.

Bill 35, as amended, reported.

WORKMEN’S COMPENSATION AMENDMENT ACT (CONCLUDED)

The committee divided on Mr. Bounsall’s amendment to subsections 2 and 3 of section 1 of the bill which was negatived by the same vote.

The committee divided on Mr. Bounsall’s amendment to subsection 1 of section 3 of the bill which was negatived by the same vote.

The committee divided on Mr. Bounsall’s amendment to subsection 2 of section 3 of the bill which was negatived by the same vote.

Section 3 agreed to.

The committee divided on Mr. Bounsall’s amendment to subsection 1 of section 4 of the bill which was negatived by the same vote.

Section 4 agreed to.

The committee divided on Mr. Bounsall’s amendment to subsection 1 of section 5 of the bill which was negatived by the same vote.

The committee divided on Mr. Laughren’s amendment to subsection 1 of section 5 of the bill which was negatived by the same vote.

[3:15]

The committee divided on Mr. Bounsall’s amendment to subsection 2 of section 5 of the bill which was negatived by the same cote.

Section 5 agreed to.

Bill 126, as amended, reported.

MENTAL HEALTH AMENDMENT ACT

The committee divided on Mr. S. Smith’s amendment which was negatived on the following vote:

Ayes 17, nays, 38.

Section 3 agreed to.

Bill 19 reported.

On motion by Hon. Mr. Welch, the committee of the whole House reported two bills with amendments and one without.

THIRD READINGS

The following bill was given third reading on motion:

Bill 19, An Act to amend the Mental Health Act.

CROWN TIMBER AMENDMENT ACT

Hon. Mr. Timbrell, on behalf of Hon. F. S. Miller, moved third reading of Bill 35, An Act to amend the Crown Timber Act.

Mr. Speaker: Shall the motion carry?

Some hon. members: No.

Mr. Speaker: All those in favour of third reading of Bill 35 will please say “aye.”

All those opposed will please say “nay.”

In my opinion the ayes have it.

Motion agreed to.

THIRD READINGS (CONTINUED)

Bill 126, An Act to amend the Workmen’s Compensation Act.

ANSWERS TO QUESTIONS ON NOTICE PAPER

Hon. Mr. Welch: May I take this opportunity to table the answer to question 22 and questions 111 to 127 standing on the notice paper.

The Honourable the Lieutenant Governor of Ontario entered the chamber of the Legislative Assembly and took her seat upon the throne.

ROYAL ASSENT

Hon. P. M. McGibbon (Lieutenant Governor): Pray be seated.

Mr. Speaker: May it please Your Honour, the Legislative Assembly of the province has, at its present sittings thereof, passed certain bills to which, in the name of and on behalf of the said Legislative Assembly, I respectfully request Your Honour’s assent.

Clerk Assistant: The following are the titles of the bills to which Your Honour’s assent is prayed:

Bill 7, An Act to revise the Securities Act.

Bill 8, An Act to regulate Trading in Commodity Futures Contracts.

Bill 9, An Act to amend the Business Corporations Act.

Bill 19, An Act to amend the Mental Health Act.

Bill 35, An Act to amend the Crown Timber Act.

Bill 123, An Act to amend the Game and Fish Act.

Bill 124, An Act to amend the Residential Premises Rent Review Act, 1975 (second session).

Bill 126, An Act to amend the Workmen’s Compensation Act.

Bill 131, An Act to establish the City of Hazeldean-March.

Bill Pr13, An Act respecting the City of London.

Bill Pr18, An Act to revise the Hamilton Civic Hospitals Act, 1961-62.

Bill Pr23, An Act respecting the City of Toronto.

Bill Pr26, An Act respecting the City of Thunder Bay.

Bill Pr29, An Act to revive Poly-Aire International Limited.

Clerk of the House: In Her Majesty’s name, the Honourable the Lieutenant Governor doth assent to these bills.

The Honourable the Lieutenant Governor was pleased to retire from the chamber.

BUSINESS OF THE HOUSE

Hon. Mr. Welch: Mr. Speaker, perhaps I might just take a minute to make one or two comments in connection with the balance of the afternoon, in case there are those who didn’t get a copy of the latest program.

We had some discussions over the luncheon break and at the appropriate time I have agreed to bring in a motion that we would take into consideration sessional paper 162, which will provide a vehicle for the debate on the automotive industry. The agreement is that the debate would conclude at 6 p.m. The opposition parties wanted some opportunity to complete their research. We then agreed there would be some opportunity for the member for Nickel Belt.

BUDGET DEBATE (CONTINUED)

Resumption of the adjourned debate on the amendment to the motion that this House approves in general the budgetary policy of the government.

Mr. Laughren: Mr. Speaker, I appreciate this opportunity to take part in the budget debate and to lay before the members of the Legislature some of our alternatives. I understand the problem of time constraints this afternoon and I shall make every effort to make my remarks as concise as possible, while at the same time doing justice to the seriousness of the problem we face in Ontario.

The purpose of a provincial budget is to lay before the Legislature the fiscal and monetary intentions of the government on a yearly basis. It is undoubtedly the most important single indicator of a government’s ideological, social and economic commitment. It should also address the principle of economic as well as fiscal problems facing our society.

Before the Ontario Treasurer (Mr. McKeough) brought in his 1978 budget, I suspect there would have been general agreement among most people, including the Treasurer, as to the major problems we face in Ontario. I suspect there would have been agreement that unemployment in excess of 325,000 was the number one problem. I suspect the state of our manufacturing industries would be another area of agreement. Employment simply is not expanding in manufacturing the way it should be. I suspect we would have been in agreement that the auto pact had to be enforced in order to provide our fair share of jobs, investment, research and development in Ontario. I suspect as well that the ills of our resource industries would also have been agreed upon as a problem area.

So, given such common ground, how is it that we disagree so profoundly on how to resolve these problems? The answer is simply that the Conservatives are convinced that our economy can be saved only by the private sector. Thus we have in Ontario serious problems with which the Treasurer refuses to deal because of his blind faith in the private enterprise system.

This debate would not be so important if the private sector was investing in Ontario, was creating jobs in Ontario, was exporting manufactured goods from Ontario, doing research and development in Ontario, and building a strong, labour-intensive manufacturing base in Ontario. But the private sector has not done that and has given us no indication that it intends to.

Despite this, the Treasurer insists that the way to cure our economic ills is to rely on that same private sector that got us into this mess. Surely it would be naive of us to believe that the auto manufacturers, of their own volition, will give us a fair share of jobs, retooling investment, and research and development expenditures. We would be naive if we believed that resource corporations are going to willingly diversify, further refine and introduce a policy of buy-Canadian purchasing.

[3:30]

I want today to offer a critique of the Treasurer’s budget, an analysis of the Ontario economy and a presentation of our alternatives. Let me assure members that we are serious about our alternatives. We are appalled at the lack of imagination and courage shown by the Treasurer in his 1978 budget. We are appalled at his taxing policy, his tax exemptions and concessions, and his lack of initiative in creating jobs for Ontario’s unemployed. There is no better symbol of the Treasurer’s incompetence in handling of the Ontario budget, and the Ontario economy, than the dismal performance of his revenue estimates for last year.

We can make allowances for the original estimates he made in 1977; after all, that was an election year. I am sure he would view the $700 million-plus drop in his taxation revenue expectations in 1977, from April 1977 to budget time this year, as a bit of harmless puffery designed to make the voters feel happier in the weeks leading up to the 1977 election. After all, it would have been hard for the government to play budget balancer with a projected deficit of $350 million higher than 1976-77 figure.

So as I said, we can make allowances for the figures the Treasurer used at budget time last year, he had a higher political purpose in mind when he created them; but we cannot take the same charitable approach to this year’s budget, and the figures he used this year are disastrously off. At budget time, on March 7, he was projecting total revenues of $6.881 billion for 1977-78. Barely one month later, the documents released along with the Treasurer’s response to the federal budget showed a drop in expected tax revenues of $225 million down to $6.656 billion. The first update of the budget projections for 1978-79 are not public yet, but they are sure to show a similar pattern for this year’s figures.

The overall figures show the Treasurer’s incompetency in budgeting. The details reflect a steady deterioration of the Ontario economy and the failure of the government’s economic policies. Corporation tax revenue dropped from $966 million estimated at budget time in 1977, to $877 million at budget time this year, and then dropped a further $140 million in the April 1978 estimates.

This shortfall in revenues in last year’s budget is bad news for the Treasurer’s projections for 1978-79. In addition to the change in the figures for 1977-78, on which those projections were based, the Treasurer has had to back part way down on his OHIP increase and has given up $144 million in sales tax revenues in conjunction with the federal budget.

Our analysis suggests that he has lost $647 million in revenues -- $141 million from OHIP, $144 million from the sales tax cut and $362 million from the deterioration of the economy. Instead of the deficit of $1.36 billion projected in March, the figures now available suggest that it will be in the $1.8 billion to $1.9 billion range. So much for the Treasurer’s budget calculations.

The Treasurer has not done any better in his overall economic forecasts. Since his March budget, the Conference Board in Canada and other forecasting agencies have revised their predictions for Canada downwards. The conference board’s forecast of growth for Ontario has been reduced from 5.1 per cent to 4.2 per cent. In his budget the Treasurer forecast unemployment at 280,000, a slight improvement over last year. So far this year, the number of unemployed has not been below 300,000, hitting a record of 345,000 in March. Even the Treasurer must now acknowledge that his failure to propose any job-creation measures in his budget would do great harm to an already weak economy. Even the Treasurer’s student-job-creation program has run into trouble. He underestimated the need for the assistance, but rather than extend the program he cut it off.

At budget time he made a great to-do about having no need for public borrowing this year. In his response to the federal budget on April 10, he acknowledged that some bargaining would be necessary to “facilitate our cash flow.” Then just the day before yesterday, he announced that the government would be borrowing on a regular basis this year.

He made a proposal for assistance for research and development, and indicated that Ontario wanted to proceed along these lines immediately; but even the federal government’s pathetic non-proposal of April 10 was enough to satisfy the Treasurer and he dropped the idea.

No more than three pages of a very thin, 20-page budget speech by the Treasurer dealt with municipal finance, property tax reform and property tax relief for senior citizens. Just two weeks ago he completed his retreat on assessment reform. In doing so he not only chose quite deliberately to ignore a number of real problems with the present system that could be resolved without major tax reform but he also underlined the cynicism of the government’s view of revenue-sharing and property tax relief.

Having redefined the so-called Edmonton commitment last September, he declared that Ontario would take any money it would have to use to pay taxes on its property as a result of tax reform out of the money it would otherwise pay in grants. In other words, municipal taxpayers would have to pay to Ontario government property taxes. And he raised cynicism to new heights when he tied property tax credit changes to the acceptance of his tax package.

Finally, he was forced by this Legislature to back down on the measure that became the symbol of his budget: the 37.5 per cent OHIP premium increase. He did so without grace. In typical Tory fashion he chose to save money by destroying jobs. His growth figures are inflated, his revenue estimates are inflated and his policies -- from health care premiums to mining taxes -- have been shot down in flames. Ontario deserves more than a Treasurer who refuses to face reality or whose policies lack the confidence of his colleagues on both sides of the Legislature.

The budget lies in tatters; there isn’t a page of it that means anything today. That makes its failure to deal with building the Ontario economy in the longer term even more serious.

At the first ministers’ conference in February of this year, the government of Ontario was one of the main proponents of belt-tightening in government. It was not surprising that the March budget boasted of checked growth of government spending and a pledge to balance the budget by 1981. On the flipside of this well-worn record about public sector restraint is the Treasurer’s tune about “reducing regulation to free up resources and initiative for the public sector.” The Treasurer has been addressing luncheons around the province proclaiming that they are “targeting for a balanced budget to make room in the economy for the private sector to grow and flourish.”

There is both an ideological and an economic element behind the Treasurer’s chorus. The ideological element is quite simply explained by the Tories’ aversion to anything but the free enterprise approach to the economy. The vociferousness of their current proclamations has been triggered by the realization that government activities have grown to the point where they now represent 33 per cent of the gross provincial product in Ontario. This growth of the public sector has been noted in other provinces of Canada and in the United States. In both countries the inspiration for an ideological attack on the growth of government and a call for a return to the free market for all economic activity has come from the so-called Chicago school of economic thought. It is clear that it has caught on in economic circles in the government of Ontario, and particularly with the Treasurer.

The economic reasons behind the Ontario government’s move towards public sector restraint are more complicated. At the root of the problem is the fact that the Tories have mismanaged the economy of Ontario in the postwar period. It is finally catching up with them.

The economy of Ontario today is characterized by a largely foreign-owned and export-oriented resource sector, a largely foreign-owned and underdeveloped manufacturing sector and an over-extended service sector. The service sector now accounts for 64.5 per cent of Ontario’s labour farce, including the 19 per cent which is in the government sector. That leaves only 35 per cent of the labour force working in commodity-producing sectors. But it is this sector that produces the wealth which underpins the rest of the economy. The result is a distinct upper limit to the number of service jobs Ontario can support.

Yet when the resource and manufacturing sectors of the economy have failed to create employment opportunities because of this slower-than-average growth, or actual decline, the government has been forced to step in to create jobs as the employer of last resort. Governments in other western countries have also played this role, but Canadian governments have been especially critical in this role as a job provider because of the huge structural difficulties associated with our dependence on the United States.

In the period 1966-76, the public sector in Ontario absorbed about 30 per cent of the new entrants into the labour force. Government employment now accounts for 19 per cent of the total in Ontario. The startling fact is that manufacturing industries only account for about 24 per cent.

In the 1970s the Ontario government has been faced with the problems of both a sluggish economy and inflation. The safety valve of further expanding the public sector no longer exists for the government of Ontario. We are now witnessing the results in the Treasurer’s restraint and austerity programs.

Another reason the Treasurer is getting fidgety about the size of the activities of government is related to Canada’s dismal overall trade performance. Traditionally, Canada and Ontario have relied on experts of raw materials in Ontario, nickel and other minerals, pulp, newsprint and lumber, and hydro-electricity to offset our trade deficit in manufactured goods. However, by 1975 the rise in imports of manufactured goods could not be covered by resource exports, resulting in a merchandise trade deficit of $500 million that year in Canada.

While Canada had a merchandise trade surplus in 1976-77, this was offset by large deficits on service payments for the foreign capital borrowed and on tourism. All this adds up to a huge and increasing deficit on the current account, over $4 billion in each of the past three years. The response of the government of Ontario, along with other Canadian governments, has been to turn to the United States and European money markets for more capital to cover the debt. In theory, the new borrowings are to be put into new resource projects on which will be based new exports which will in turn cut the level of the current account deficit.

In 1976 Canadian corporations and governments borrowed $9.2 billion abroad, greatly exceeding borrowing by any other country. Ontario Hydro has required large sums of borrowed capital from the United States; $530 million in 1975-76, $260 million in 1976-77, and $392 million in 1977-78. That latter is an interim figure. The effect of these ever increasing borrowings on individual Canadians and on businesses is a burden in the form of higher interest rates which have led to a higher cost of living and a higher cost of doing business. The effect of these ever-increasing borrowings on government is that an increasing proportion of their total expenditure is spent paying the interest on the public debt. In Ontario in 1975-76 the interest on the public debt was $725 million or 6.9 per cent of all expenditures. In 1977-78 it has reached over $1 billion and eight per cent of total expenditure. Interest on the public debt was the only expenditure to increase its proportion of total spending between 1975-76 and the 1977-78 budget years.

For all Canadian provincial governments, the average real growth rate for interest on the public debt was 13.4 per cent from the period 1961-76 whereas expenditure on goods and services grew at 10.7 per cent. In these circumstances it comes as no surprise that the squeeze is being put on other government services and expenditures, nor is it surprising that the Ministry of the Treasury, Economies and Intergovernmental Affairs is trying to avoid further deficits of any kind. The situation substantially cuts down the Treasurer’s room to manoeuvre, but it cannot serve as an excuse since the Conservative government is responsible for mismanaging the economy and getting us into this mess in the first place. They must take full responsibility for allowing a structure of a weak productive sector and an over-developed service sector to persist. They now have to face the reality that public spending and more borrowing will no longer prop up a shaky provincial economy. The implication of doing so is that more and more of our future will be mortgaged to pay for past errors.

What is happening to Ontario’s economy? During 1977, real growth in the Ontario economy is estimated to have been only three per cent, compared with almost five per cent in 1976. Capital investment has continued to be sluggish. Unemployment increased to seven per cent as the job-creation rate lagged behind labour force growth. Trouble spots can be identified in the mining, manufacturing, agricultural, construction and public administration sectors. The steel industry has had two years of stagnant demand and like the pulp and paper industry has been operating at only 80 per cent capacity.

Consumer spending, which accounts for nearly 55 per cent of the gross provincial product, is weak, with retail sales for Ontario showing only modest gains in the third quarter of the year. During 1977 the Ontario labour force averaged more than four million participants, of whom about 3.8 million were employed. The annual growth rates for the labour force and employment were approximately three per cent and two per cent respectively.

The provincial unemployment rate fluctuated between 6.2 per cent and 7.4 per cent during 1977, a significant rise over the previous year’s range of 5.7 per cent to 6.5 per cent. The unemployment rate among males increased from 5.1 per cent in 1976 to 5.9 per cent in 1977, while that for females jumped from 7.8 per cent to 8.6 per cent. The highest unemployment rate by far is in the 15-24 age group, at 13 per cent for the year. The current unemployment rate in Ontario is running at about 7.5 per cent, seasonally adjusted.

The outlook for Ontario’s unemployment in the short run is not very bright. Indications suggest even higher unemployment rates than those experienced so far. Ontario’s weak and unbalanced economic structure is best reflected in the figures for employment by industry. Less than two per cent of the total labour force is employed in forestry and mining, our key export industries. Personal and community service industries employ more people -- 28.7 per cent of the total -- than do manufacturing industries at about 26 per cent. Direct government employment has risen to 7.3 per cent of total employment. If you take all government-related employment, including health, education and so forth, Mr. Speaker, it’s actually closer to about 20 per cent.

Employment in agriculture, other primary industries, transportation, communication, and utilities, as well as manufacturing, all exhibited negative or no growth in 1977. The construction, trade, service, public administration, finance, insurance and real estate industries showed positive performance. This poor performance in productive, relative to service, sectors is not peculiar to 1977. A comparison of the employment figures by industry in 1967 and 1977 gives us an idea of the underlying trends in the structure of the Ontario economy.

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Overall employment in all productive sectors, including agriculture was 40.9 per cent of total employment in 1967. By 1977, this percentage had dropped to 32.9 per cent. Correspondingly, employment in nonproductive sectors, including banking, finance, real estate, community and personal services, government trade and transportation, has risen from 59.1 per cent to 67.1 per cent of total employment. It is to be noted that the wealth-absorbing work now employs over two thirds of the labour force in Ontario, leaving only one third of the work force in wealth-creating activities.

Employment as a percentage of total employment has actually declined over this period in each specific industrial sector, mining, forestry, manufacturing and construction. Manufacturing is the most noteworthy, showing a decline of seven per cent from 33.2 per cent to 26.3 per cent. Manufacturing then is Ontario’s poorest performer over the past decade. There is a similar trend for all of Canada. As a matter of fact, employment in manufacturing as a percentage of total employment dropped from 23.4 per cent to 19.5 per cent in 1978. The decline is greatest in Ontario, and this is the home of half of the nation’s manufacturing output.

For 1978, manufacturing in Ontario is expected to grow at 4.5 per cent, compared with three per cent in 1977. Strong performances are hoped for in pulp and newsprint, chemical and plastic products, primary metals, metal fabricating and transportation. The devaluation of the Canadian dollar is expected to assist in creating an improved international competitive position as well as making domestic products more attractive to Canadian consumers. The Alaska highway pipeline construction is expected to make its initial impact felt on the Ontario economy by the third and fourth quarters. In the interim, strengthening consumer demand should continue to keep the manufacturing sector buoyant.

Such rosy forecasts are dubious in the light of the underlying trend over the past decade of steadily reduced employment in the key sectors. Furthermore, the chief industry, the auto parts and assembly industry, is in trouble in the long term because Canada is not receiving its fair share of parts production nor its fair share of research and development and investment. The stimulative effect of the devaluation of the dollar will be only short lived. In the longer run, we will experience inflationary pressures because of the increased costs of imports and increased cost of borrowing foreign capital.

Finally, there is a sluggish investment in the Ontario manufacturing industries, in part because the Treasurer has adopted a free trade stance with little evidence that industrial adjustment programs to help industries adapt to freer trade will be either significant or helpful. He is going around the province stating that it will be the industrial heartland of this country, and Ontario in particular, which will have to bear most of the burden in adjusting to freer trade. While he does throw out platitudes to the effect that effective leadership and adjustment assistance will help us adjust, the manufacturers of this province are understandably uncertain about the future.

In the budget presented to us in March, the Treasurer also predicted favourable economic prospects for 1978 and 1979, with real growth estimated at 4.3 per cent for 1978 and 5.5 per cent for 1979. He forecasted a strong export performance, the creation of 100,000 jobs, a small decline in unemployment and a steady expansion of private sector jobs and private sector prosperity. Studies exist, however, prepared even in the Treasurer’s own ministry, that assume no such healthy private sector or industrial growth over the next decade.

In a report issued in June 1976 by the Treasurer’s department entitled, A Long Term Projection of Ontario’s Industrial Development Pattern, we can see what the assumptions of the government really are with respect to future employment trends in various sectors of the economy and thus the prospects for growth in those sectors. The report pointed out that while in 1961 the manufacturing sector of the Ontario economy employed 30.7 per cent of the labour force, by the rnid-1970s this proportion had fallen to 24.6 per cent. The report predicted that by 1985 only 20.1 per cent of provincial employment will be in the manufacturing sector and that by 1995 the proportion will be down to 16 per cent.

What does this mean for job creation in the eyes of the Treasurer’s department? While in the 1960s annual employment in manufacturing grew in the province by 2.3 per cent, in the 1970s the growth rate has fallen off to 0.7 per cent a year. Since 1974, in fact, there has been a decline. For the future, the Treasury department report projected that job creation in manufacturing will be much below that in the 1960s and that output growth in manufacturing will continue to slow down over the next two decades.

The Ontario Economic Council has more recently come up with similar projections for employment to 1987. According to its calculations, commercial services will account for 32 per cent of employment growth, government for 30 per cent and personal services for 15.3 per cent. Manufacturing is estimated to contribute only 12 per cent of the growth for 1987, and mining and forestry only one per cent.

There is no doubt as to the general direction predicted for the Ontario economy in these in-depth reports. The economy of the next decade will be characterized by an increasingly weak manufacturing sector and dangerously top heavy and still growing service sector. This reality stands in stark contrast to the recent forecasts by the government of Ontario.

I’d like to turn to a specific portion of the budget now. One of the changes announced was an exemption from section 113 of the Mining Act for Ontario’s resource corporations. That section requires companies to process their minerals here. The Treasurer is not only going to allow the companies to ship ores elsewhere for processing, but he is going to allow them to charge those refining costs against their Ontario profits. We object to such a policy because we feel it exports jobs to places such as Norway and the UK and reduces the revenues Ontario receives in the form of mining profits taxes.

We know that Falconbridge, a company that already has had an exemption, has been resident in the Sudbury area for 45 years and has never built a refinery there. Falconbridge still ships its ores to Norway for refining and further processing. Inco continues to ship a significant proportion of its ores to Wales for refining.

When our leader in his reply to the budget expressed our opposition to the Treasurer’s policy changes, we did not know of the existence of a Ministry of Natural Resources report, entitled Toward a Nickel Policy for Ontario. We did not know of it because it was not released until 10 days after the budget date, even though it was completed in December, 1977. The report, by a senior Ministry of Natural Resources official, Dr. Tom Mohide, condemned the whole concept of processing exemptions and stated so very explicitly. The report recommended, among other things, that unused refining capacity here be utilized before processing exemptions were granted and the ore was shipped to other countries.

Within 10 days of his budget the Treasurer had his mineral policy shot down in flames by people more knowledgeable than himself about mineral taxation policies. As a matter of fact, during the select committee hearings on the nickel industry layoffs, both Inco and Falconbridge officials told us that taxation policies were not the solution to their problem. The problem was world-wide demand in relation to stockpiled inventories. It is hard to imagine where the Treasurer got his advice on tax policy affecting the mineral industry.

One of the criteria used by economists to determine the economic benefits of mineral exploitation is known as linkages. There are forward and backward linkages. In Ontario, we do not benefit sufficiently from either. Backward linkages relate to industry’s purchasing of input. In Canada, backward linkages result in purchases from suppliers outside this country. That explains our huge deficit in mining machinery and equipment. Domestic shipments supply only 21 per cent of the Canadian mining machinery market, despite the fact that Canada ranks number three in the world in mineral production.

Forward linkages relate to processing and fabricating. In Ontario, these linkages run outside the country as well. We not only have an industry that refuses to process domestically, but we have a Treasurer who discourages it by granting processing exemptions to the entire industry.

When I was a member of the select committee on the nickel industry layoffs, I did some research and came across a 1915 report of the Ontario Royal Commission on Nickel. What a revelation it was. At that time there was public pressure for Inco to do its refining here rather than in the US. I quote from that report: “There is, first, the natural desire to have all the work on raw material which is produced here done at home, up to the point of turning out the finished article. Employment is given to Canadian workmen, Canadian chemists and Canadian experts. The rewards of this labour are spent in Canada and swell the volume of Canadian business. There is a feeling of impatience at seeing Canadians as hewers of wood and drawers of water, while in another country technical and skilled work is performed in refining an article of Canadian origin.”

Mr. Warner: Old Tories never change.

Mr. Laughren: Back in those days, the industry used the same kind of arguments it uses now. When testifying before a House of Commons committee in 1910 the industry said: “Certainly nickel could be refined in Canada but not at a price which would enable it to compete with nickel produced abroad. If the industry were attempted in southern Ontario, the sulphur fumes would be considered a nuisance. An export duty on matte would close up the works at Copper Cliff, and consequently the mines also, in which case the company would bring ores or matte from their nickel lands in New Caledonia to be refined in the USA.”

Little has changed in the last 65 years. It is an affront to all of us that with mineral production valued in excess of $2 billion this year, mining taxes will total less than $20 million. That is less than a one per cent return on our non-renewable resources. That kind of return is the result of allowing our resources to be exploited without a coherent industrial or mineral strategy to ensure that maximum benefits accrue to the people of Ontario.

The person responsible for taxation policy in this province is the Treasurer. He has allowed our minerals to be frittered away with no long-range planning for the resource communities when those minerals are depleted, and no guarantees we will obtain maximum benefits from those minerals while they are being depleted. There is no single area in which the differences between the government and we New Democrats is greater.

What is so worrisome about the mining industry in Ontario is that much of our prosperity has been based on the export of our minerals. It is the export of minerals which in large part has allowed us to import such a large percentage of our manufactured goods and allowed Canadians to achieve the standard of living which they presently enjoy.

It is not just the economic health of northern Ontario that is at stake. The mining industry has changed in recent years and it has become much more capital intensive as the companies streamline their operations and improve their productivity. It is appropriate, of course, that our industries should utilize the latest in technology to enable them to most efficiently extract the ore. We get into trouble when that technology is purchased elsewhere. We end up with an increased rate of ore reserves depletion and fewer jobs to accomplish it.

Between 1966 and 1974 the total number of people employed in metallic mining in Ontario declined in absolute numbers from 27,000 to 25,400, a decline of 6.4 per cent; and during the same period ores mined increased from 43 million to 62 million tons, an increase of 44.5 per cent.

It is not as though the mining industry was not profitable and was not able to contribute to Ontario revenues. On the contrary, between 1966 and 1977 the average profitability measured in net income as a percentage of sales was extremely good. Between those years the net income as a percentage of sales for total manufacturing averaged 4.2 per cent; for total industrials 4.2 per cent and for metal mines and primary metals 11.3 per cent.

The industry sometimes argues that tax breaks are necessary if there is to be continued exploration and development in the province, but the companies have been receiving concessions and substantial profits and have not been doing the exploration and development which is necessary to ensure we have a continuing healthy mining industry in Ontario.

In 1978, mining tax revenues will drop to about $20 million. That represents a sad but telling commentary on the mineral management policies of this government. It is not as though this government has not been warned. Experts in mining have been telling the Ministry of Natural Resources that it is wrong. The Ministry of Natural Resources document entitled Towards a Zinc Policy for the Province of Ontario said: “We have the potential to expand the province’s zinc mining and refining capacity. We have the undeveloped ore in the province, but there is ore elsewhere as well.”

Accordingly, the report warned: “If plants are not planned now and built here in Ontario they will likely be built elsewhere.” The report suggested a number of ways the province could stimulate zinc activity, including direct provincial involvement in a custom refinery, that is a refinery that handles ore from different companies. This might provide employment for about 500 people. When it comes to mineral policy this government has decided to let the chips fall where they will. There simply is no policy. This government has taken the path of least resistance. We have had a succession of unimaginative if not downright dull-witted ministers who lack the courage to be either creative or innovative; and they hide behind their failure by insisting that the private sector knows best.

When free enterprise fails us, Mr. Speaker, the Frank Millers and the Leo Berniers and the Darcy McKeoughs of this world tell us there is no better way. To date, the government has shown no evidence that it intends to develop a mineral policy for the province. Whether we talk about zinc or nickel it is evident that our natural resources advantage is slipping away.

The government might have renegotiated the price of mining leases to make sure that the province gets its fair share for its own resources. The government has not done this. This government has simply granted mindless concessions which guarantee nothing more than the exports of jobs to some other jurisdiction.

Nothing could be a better example of the government silliness and shortsightedness in dealing with Ontario’s natural resources and industrial development than uranium. For years now Ontario has returned from federal-provincial conferences in abject failure. At every conference Ontario has railed away at the cost to this province in jobs of oil and gas price increases. Despite this deliberately vocal and politically useful opposition from Ontario, oil prices in this country have moved in lock-step toward the inflated world price. Ontario’s excuse has always been that we don’t own the oil so we can’t call the tune; the tune calling is done by Alberta and Imperial Oil.

But in the case of uranium we own the resource, a significant source of energy and one which promises to be even more important in the future. It is under our control, and in fact is public property. What did Ontario do? Did it take the opportunity to give our industry a competitive advantage to lower energy prices? Did it take the opportunity to use the wealth generated by Ontario’s resources to strength our industrial base? Of course not; this government gave away the opportunity in the biggest single resource sellout in the province’s history.

[4:00]

Ontario Hydro takes all the risks, puts up all the capital at no interest and guarantees the price. Rio Algom and Denison Mines simply pull in the profits, an estimated $2 billion at least over 40 years. All the while Ontario was whining in public about having no control over energy prices, it was ignoring the recommendation by Hydro itself that the uranium mines be brought into the public sector.

At the time the contracts were signed, we in the NDP argued that a controlling interest in the two companies could have been purchased for about $300 million, roughly the amount of Hydro’s interest-free investment in the mines. The people of Ontario will be paying for years for this government’s blind devotion to private enterprise in higher energy costs and slower economic growth.

We believe that if the resources in this province were in the public sector they could be used to help us reverse the trend of declining employment and the de-industrialization of the province. One of the present problems is that employment is declining in the resource industries because of the highly capital-intensive nature of those industries and because the machinery is being purchased elsewhere. Obviously the industry must modernize, but it would be to the advantage of all of us if this was to happen with the purchase of machinery made in this province or elsewhere in Canada.

We have never advocated the public ownership of resources for punitive reasons. We have done so because it makes good economic sense. New Democrats believe that the economic surplus generated in the resource sector should be partially directed to the building of a heritage fund, similar to those already in place in Alberta and Saskatchewan, to establish a healthy manufacturing base.

There is no better example of this potential than with mining machinery. it is ludicrous that we have a $750-million deficit on mining machinery in Ontario while our mining industry ranks number three in the world. The private sector is not going to do this because of the cosy relationship between the resource industries and the machinery manufacturers elsewhere. It surely is no coincidence that there are interlocking directorships between Inco, for example. and mining machinery companies in the United States. It is a most comfortable arrangement and perfectly legal.

We believe the revenues generated by the resource sector should be reinvested in job-producing secondary industries tied to that resource base. It is no coincidence that resource communities suffer from a lack of municipal and social services. It is no coincidence that there are very few jobs available in resource communities for our younger, well-educated people. Those resource communities have plainly and simply been used in a cavalier fashion, and we say that enough is enough.

There are people who make the claim that, by increased taxation, we can have control of the resource sector without the ownership. I do not believe that is possible, for a couple of very important reasons.

First, when taxes are increased in the resource sector the private sector simply diverts an ever-increasing amount of its investment funds to another jurisdiction. We have already seen Ontario’s percentage of world nickel markets decline dramatically from 85 per cent in 1950 to approximately 35 per cent in 1978. That is at least partially because Inco and Falconbridge have made a commitment to developing their resources in the Third World.

The second major reason taxation policy can never return maximum benefits to the people of Ontario is the principle of high-grading. High-grading in the resource sector is a practice of extracting the high-quality ores while leaving the low-quality grades behind. The grade level at which an ore is economically valuable is, of course, determined by the price of the mineral. If either the price of the mineral drops or the taxation of the industry goes up, then the private sector simply raises the grade level at which it is economical to mine that particular mineral. Any jurisdiction which raises the level of taxation to a level unacceptable to the private sector simply encourages the high- grading of resources, which means they become depleted all the faster. Surely we cannot accept as a mineral policy one that encourages high-grading and the rapid depletion of a non-renewable resource, any more than we can endorse a mineral policy that returns one per cent of the value of the ores to the Ontario Treasury.

There are reasons of occupational health and safety and environmental control which also justify public ownership of resources and when they are combined with the important role our resources can play in the development of a new and exciting industrial strategy the argument becomes compelling indeed.

I would like to turn next to our forestry industry, which is having problems, although they are different from those of the mining industry. Between 1967 and 1975, employment declined by 1.7 per cent in the industry while the value of pulp and paper sold increased by 64 per cent. The Canadian Council of Resource and Environment Ministers’ task force report on forest policies in Canada had this to say about the Canadian forest industry -- and of course it applies in spades to Ontario: “It is believed that a large portion of the Canadian forest industry has technologically fallen behind its international competitors and that there has been a relatively low level of reinvestment in plants.”

Our situation is deteriorating rapidly. According to Mr W. J. Johnson, vice-president of Abitibi Price in charge of woodland operations, there are currently 27 new pulp and paper processing machines on order for installation in the United States, compared with one for all of Canada. Abitibi has recognized this trend and has itself already established two mills in the southern United States. According to Doug Drysdale, director of the timber sales branch of the Ministry of Natural Resources, unless investment is made to modernize our pulp and paper mills the industry in Ontario will be in even more serious trouble.

The problem is circular. If the pulp and paper companies do not put any money into modernizing their mills, we certainly cannot expect them to care about forest management. Without investment in forest management there won’t be enough wood for the mills. Forest management and mill modernization go hand in hand, and investment must be made in both if our forest industry is to survive.

The forest industry is too important in Ontario to be ignored when the Treasurer is establishing fiscal policies for the province. There are approximately 78,000 people directly employed in the forestry industry and the same number indirectly. That means 156,000 jobs are created by our forests, but there is a very real danger that the number will drop considerably unless the industry modernizes its plant and equipment, and unless the government requires such investment in return for the cutting rights for a resource that belongs to the people of Ontario.

The combination of extremely poor reforestation policies and the failure of the industry to invest in modern technology has brought us to a crossroads in the forest industry. It is incumbent upon this government to establish policies to ensure that the situation does not deteriorate further and that profits earned on our resources are ploughed back into the industry.

This, of course, will require intervention on the part of the government, which in turn requires courage. Despite the fact that these ingredients have not been evident on the part of this government, the time has come when further delay simply cannot be tolerated. The Ontario timber revenue task force in 1975 had this to say:

“The potential benefits of further processing of pulp merit examination. Pulp production is the most energy and pollution-intensive of the forest-based industry activities. It is, therefore, a high-cost activity which offers less return to the province than basic paper and paperboard production. An examination of the potential processing of pulp would be timely, given that the expansion plans of Ontario’s industry are highly oriented towards pulp rather than paper production.”

That same task force warned us of the dangers of our very heavy dependence on one foreign market -- namely the US --

Mr. Nixon: That’s it, 40 minutes.

Mr. Laughren: -- and recent evidence shows the danger of relying on one market when that market deteriorates.

Our market share of newsprint sales in the US has dropped from 80 per cent in 1950 to 60 per cent today. This is primarily the result of southern US production, and if the trend continues the problems in the forest industry will be even more severe than they are today.

Recent figures showing substantial profits gains in the industry should not be simply noted and forgotten. In 1977, forest products was one of the leading sectors, with increases in sales of 92 per cent, and in Ontario the figures were even higher. For example, Abitibi’s net income increased by 191 per cent; Domtar by 153 per cent and Great Lakes Paper by 194 per cent. A significant portion of this increase is the result of our devalued dollar. Great Lakes estimates that the exchange premium accounted for 57 per cent of their 1977 net earnings.

The big question is what these companies will do with these increased earnings. Ostensibly, one of the aims of wage and price controls was to get investment going in Canada again. For the pulp and paper industry this is particularly acute. Even in years of record profits the pulp and paper industry has failed to reinvest in Ontario. The average age of pulp facilities in this province is 38 years and of paper mills four years. That information comes from a report of the Ontario timber revenue task force. The result is a forest industry that has fallen behind international competitors.

It is a sad commentary that resources such as minerals and forestry have been allowed to fall behind, either in world market share or in competitiveness because of the failure of this government to develop policies to sustain a healthy industry.

I have been talking about the weakness of several sectors of the economy. I would like to turn for a moment to some of the regional economic problems and the government’s failure to do anything about them.

The Ontario Economic Council recently released a paper entitled Input-output Analysis of Fiscal Policy in Ontario, which had some revealing comments to make about the Treasurer’s fiscal policy.

Mr. Nixon: Are you half-way through?

Mr. Laughren: Yes.

The study indicates that Ontario’s fiscal policy tends to favour the Toronto-centred region at the expense of other regions of the province. To quote the paper: “Virtually all Ontario government programs have had the effects of increasing the concentration of employment in the Toronto-centred region and of increasing regional income disparities.” In other words, the government’s economic policies have made the regional differences even greater.

The Treasurer seems unable to design and implement policies directly relevant to the regions that need economic development. What the Treasurer does not seem to understand is that people in the north, the east and the west of this province would much prefer to have a self-sustaining economy rather than government handouts which simply make the various regions more dependent upon Queen’s Park, and when government restraint is necessary it is those very areas which are the first to feel the crunch.

When the Treasurer indicated that he had to have $78 million in order to pay for the reduced OHIP premiums, one of the first areas which he selected was the regional priorities budget of the Ministry of Northern Affairs. He did this despite the dramatic unemployment figures for northern Ontario. If we had a balanced, growing economy we would not have to be so preoccupied with either balancing the budget or with regional disparities.

A look at the unemployment levels across the province is interesting indeed. Communities with a skilled work force and a developed municipal, industrial and educational infrastructure are experiencing completely unacceptable levels of unemployment. The St. Catharines-Niagara area leads all major municipal areas with an unemployment rate of 11.7 per cent, slightly worse than Sudbury and Kitchener-Waterloo, each of which have an 11.2 per cent.

In all of Canada, according to Statistics Canada, only St. John’s, Newfoundland, and Chicoutimi-Jonquiere in Quebec have higher rates. It takes more than benign indifference to preside over that kind of economic performance; it takes creative fiscal mismanagement and the Treasurer deserves the credit.

It is a sad commentary that those parts of the province which have done so much to make the province prosperous are the ones which are paying the price now in high unemployment. The Sudbury basin has been the source of enormous wealth that has benefited the entire province. The St. Catharines-Niagara area is in the heart of the best farm land, and a centre of much of the auto parts manufacturing and assembly which occurs in Ontario. Kitchener-Waterloo is a diversified community with many small businesses. For areas like these to suffer unemployment in excess of 11 per cent indicates the seriousness of the problems in our economy.

I would now like briefly, to turn to a problem that has caused great concern to the municipal leaders all across Ontario.

Mr. Nixon: Forty-five minutes.

Mr. Laughren: Two weeks ago, the Treasurer pulled the plug on assessment reform in this province. We have been waiting for almost 10 years. It has been postponed so many times and studied so many times it would be tedious to run through the list. Now he is backing away again, blaming municipalities, the media and the opposition as he goes. The reality is that it’s the Treasurer’s own fault. He could not get his package through the cabinet, and if his package does not go through nothing goes through.

It is not hard to see why he is doing it that way. The Treasurer knows, as we know, that there are real problems with the property assessment system; the Treasurer knows that there are real problems with assessment equalization in merged areas like Cambridge; and the Treasurer knows that there are real equity problems in the provincial equalization grant system.

The Treasurer could solve these problems tomorrow if he wanted to, but he won’t. He won’t do it because he needs the anger and frustration caused by those problems to build support for part of the package he insists on getting through, namely the tax reform proposals. But it’s the tax reform and grants part of the proposal that are at the root of the problem.

The Treasurer has two great obsessions: uniformity and control, and balancing the budget. His obsession with uniformity and control has led to a municipal tax proposal in which all of the policy is set by Queen’s Park. The municipalities merely collect the taxes. The property tax becomes a provincial tax administered by local government.

Ontario is too diverse to have a single municipal tax system applicable without variation in every municipality, and the figures bear this out. His proposal on average reduces single-family residential taxes outside Metro Toronto; it increases taxes substantially in Metro. His proposal increases taxes on business outside Metro; it reduces taxes on business in Metro. In Metro, taxes on small businesses stay roughly the same; outside Metro, they go up. The only way out of the dilemma is to give local governments some flexibility in setting their own tax policy, and that’s exactly what the Treasurer won’t do.

His obsession with balancing his budget at the expense of property taxpayers is just as destructive. The so-called Edmonton commitment to revenue sharing is meaningless. The province’s grants for education have dropped from 61 per cent of expenditures just three years ago to 53 per cent this year.

Mr. Nixon: Just like some kind of nightmare, a sort of Catch 22.

Mr. Laughren: Many people see the Treasurer’s market value assessment and tax reform package as a lever to reduce Ontario’s commitment still further. The Treasurer’s actions don’t do much to allay these fears. In his tax reform proposal the Treasurer argued that it is fair for the province to pay taxes on the property that it owns, and then announced that the municipalities would pay the increased provincial costs through lower grants on a dollar-per-dollar basis.

The Treasurer should stop using the inequities created by the assessment and grants scheme. He should end the squeeze on equalization factors for grants and for cost apportionment in merged areas. He should change the Assessment Act to enable municipalities to deal with the growing volume of successful assessment appeals by large corporate taxpayers. Those changes can and should be made.

He should bring in an assessment reform system that deals with the potential problems created by market value. He should bring in tax reform that sets out the scope for municipal tax policy. He should stop quibbling over revenue sharing and should bring changes to the tax credit system that would have a real impact on the regressivity of property tax.

[4:15]

The Treasurer has not only failed to display courage or imagination in bringing in policies to stimulate and rebuild the Ontario economy, he has failed to take seriously any suggestions offered to him. When the leader of the NDP replied to the budget for us on March 14, he laid before the Treasurer a number of job-creation proposals which would have created over 45,000 jobs.

The fiscal year is not yet three months old, and already this year’s budget lies in tatters. The assumptions on which it was based are meaningless and its meagre proposals futile. Revenue estimates for last year have dropped since then, reducing the base of this year’s revenues. That weakening of the economy, together with the failure of the OHIP increase and the federally-inspired sales tax cut have added nearly $500 million to the expected deficit and shown up the Treasurer’s budget balancing plan for the hollow charade that it is.

Estimates of economic growth and employment for Ontario have been revised downwards, underlining the seriousness of the government’s failure to create jobs. Within a week of the budget’s introduction the Ministry of Natural Resources’ report was released which attacked directly the budget proposal to sell out Ontario’s resources by giving tax concessions for foreign processing. The government’s own study of the machinery sales tax rebate showed that it will cost Ontario 15,000 jobs in this year alone.

Property tax reform has been shelved again because of the Treasurer’s blind devotion to uniformity and his stubbornness. In the debate over the future of the auto industry, Ontario is floundering, trying to resolve the conflict between the Treasurer and the Ministry of Industry and Tourism when it should be leading.

Hon. Mr. Timbrell: Nonsense.

Mr. Laughren: It’s not nonsense. Although it is only three months since the Treasurer’s budget was introduced, virtually nothing in it is valid today. The budgetary deficit predicted by the Treasurer to be $1.3 billion will be in excess of $1.6 billion. Revenues will be at least $400 million below his projections.

These revenue shortfalls should tell the Treasurer what we told him in March: that his budget is a failure. Ontario’s economic problems are serious and they demand a serious response. The first priority of the NDP is to get the economy moving again and to put people back to work. In the short term we have proposed municipal projects, housing construction and other measures, to create more than 45,000 jobs. In the long run, we would provide the leadership to rebuild our manufacturing and resource sectors. The Treasurer cannot hope to balance the budget without a strong economy; he cannot hope to have a strong economy with a budget that actually makes our economic problems worse.

The Treasurer simply must bring before this Legislature a new set of budgetary policies in September or October of this year. This current budget is simply not enough as it stands. Ontario can’t afford to drift aimlessly for the next nine months with a budget that is invalid, obsolete and destructive.

On motion by Hon. Mr. Timbrell, the debate was adjourned.

AUTO PACT

Hon. Mr. Timbrell moved that the House do now consider sessional paper 162, background paper on the automotive industry.

Motion agreed to.

Hon. Mr. Timbrell: Before the debate begins, may I say it is my understanding that the House leaders have agreed this debate will conclude by 6 p.m. this evening and that the time remaining be equally divided among the three parties.

Hon. Mr. McKeough: Mr. Speaker, I suppose there are only three or four or five occasions when I have stood in this House and in some part of my remarks been parochial, which is the way I propose to begin this afternoon.

The former Leader of the Opposition (Mr. Nixon) will recall that one of those occasions concerned blackbirds; I think that was my maiden speech. He, as a farmer, will be interested to know that that problem seems to be on its way to being solved --

Mr. Nixon: Been going down hill ever since.

Hon. Mr. McKeough: This isn’t due to any great action of government; I guess it is something in the cycle of the birds which seems to have made that less of a problem --

Mr. Nixon: They keep dumping on my county.

Hon. Mr. McKeough: Well, that’s a solution to the problem in any case.

But I do want to start this afternoon by saying something about the automotive pact in terms of my own riding, my own county, Chatham, and Wallaceburg in particular. I believe the background papers tabled by the Premier (Mr. Davis) this morning indicated something about the International Harvester Corporation. This is an American-owned multinational which has been in Chatham, I believe, for over 50 or 60 years, as well as in Hamilton where they have a truck plant.

Prior to the automotive pact there were about 1,000 people -- 800 or 900 -- working at International Harvester. At that time they produced part of something like 26 trucks for Canada. Since the automotive pact they have been making three trucks, basically, for the whole North American market. During that time, employment has risen from something under 1,000 to something just under 2,000.

Additionally, in my own riding, we are blessed with a number of automotive parts plants. Eaton Springs has two plants in the riding. Canadian Fram, Rockwell and a number of smaller plants as well as tool and die shops and service industries adjacent to and part of what is the largest employer, the single most important industry in this province, the automotive industry. Something like one in six jobs are directly and indirectly related in this province to the automotive industry.

It is obviously of great concern to my people and to my riding, and a great concern therefore to me, as well as being of concern to members of the Legislature and to me as a member of the government, and as Minister of Economics for the province.

The auto pact has been good for my riding; the auto pact has been good for Ontario; the auto pact has been good for Canada. Nevertheless, it became apparent two or three years ago that the auto pact perhaps was not working fully as well as it had at the beginning or as well as some of us had hoped and had reason to believe it should work.

I take some pride in the fact -- and I say this completely immodestly -- that the first authoritative work on the subject of the auto pact appeared in my budget of 1976 when we laid out our concerns and when we laid out some of the numbers and some of the figures. During that time, the federal government took the position that we should not rock the boat. I would say that with some shifts, but very small ones, the government of Canada is still of the view that the boat should not be rocked.

Proud as I am of the achievements of my country and those who work in this country -- be they working for international firms or American firms or Canadian-owned firms -- proud as I am of the achievements of those people, both from the managerial section to those at the very bottom in those plants, the men on the lines; nevertheless, I don’t think rocking the boat is simply the answer to something where we have perceived there are some difficulties, and where for lack of a better term -- and I certainly don’t want to debate this particular issue this afternoon -- in recent years we perceive we have not been getting as fair a share as we feel we are probably entitled.

I put all this in the context of the fact that the automotive pact -- and we should not forget this -- is a treaty -- I guess that is the correct word -- between the government of Canada and the government of the United States. It is something whose levers, whatever those levers are, some of which are fragile, rest with the government of Ottawa so far as Canada is concerned. There really is very little power, very little authority; very little we can do in this House, as private members or as members of the government, to influence, without giving away the store, the outcome of that pact, which is essentially an international treaty between the two sovereign countries, each in its own right exercising its own authority and its own levers of power.

The situation is complicated somewhat by the fact that we are talking about an industry which at the vehicle assembly end is not owned in this country. I think, realistically, perhaps that does have some bearing on the situation. I don’t think it is a large factor. Whatever factor it is, the other side of that coin which must be recognized, of which I am aware in my riding and to which, I am sure, others in this House could also pay testimony, is the very superior performance of that part of the industry which is located in Canada, probably stemming from the fact that we started from behind. There was, in the early years of the pact, an enormous investment in Canada. Most of the plants which I have mentioned in my own riding -- and this is true in Oakville; it’s true in Ste. Therese; it’s true at Talbotville -- are up-to-date, modern buildings for the most part, with ample room to grow and expand, or contract as the case may be to make the necessary changes; with as good technology and machinery and equipment as is available in North America today.

On top of that, we have a work force, both at the salaried and the hourly-rated level, which is good, which is productive, which is efficient, which is well-represented by a Canadian union -- and I stress that: the United Auto Workers, with whom I’ve had my differences, and will have my differences, I suppose, in the future -- which has represented its workers well. By and large, the forces of capital, of technology, of labour, of management are working together, these factors, a good climate in this country and in this province, have produced an industry of which we in this House, as the representatives of the people of Ontario, can be damned proud.

I say that particularly with reference to a couple of plants in my own riding. Last spring I had lunch with the board of directors of that company, who are American. They have something like, I believe 90 plants worldwide -- 60 in the United States, six in Canada. I expected I would hear about higher Canadian taxes and lower Canadian productivity, or the cost of interest in Canada versus the cost of interest in the United States. I heard none of those things.

What they told me was that those two plants -- having achieved certain economies of scale, with a good work force, with the right injection of capital and technology and knowhow -- were as productive, if not more productive, than any of their 90 worldwide plants.

What I am saying then -- building on the basis that we do have other winners in this country, although we are talking about the automotive pact this afternoon -- is that we have some industries which I think, some of us realistically feel are going to have a tough time competing in the world, but this is an industry in which we have every reason to take great pride and in which we have to take a back seat to no one, particularly in the present context to those south of the border.

You will recall -- and I vividly recall -- in 1976, after the budget, the third party in this province criticized that paper; that is a matter of record and that is their right. There was a monumental yawn then from the United Auto Workers, and Ottawa disputed the whole thing and refused to do anything about it.

Mr. S. Smith: Who was the third party then?

Hon. Mr. McKeough: I then recall -- my dates may be somewhat wrong -- that there was a stirring -- and I take, as I’ve said, a modest pride in the fact that the Ontario budget paper had something to do with it -- a stirring of interest in the problems of that particularly large and vital sector of our economy.

Subsequently, the government of Canada appointed Arthur to do a report which came out in the spring of 1977. Arising from the Arthur report we have had an ongoing debate, I suppose with some intensity for the last six or eight months.

As members are well aware, and without attesting to the veracity of the figures or the breakdown of the figures, the word was spread that because of the move to more fuel-efficient cars and smaller cars, the industry over the next few years in North America would have to spend -- the figure most commonly used was something like $58 billion.

I think it’s important to know and to remember that is not all new employment. Many who have come in have pointed out that much of it is replacement; simply replacing old machinery, perhaps old buildings, old dies, old presses with new machinery. The increase in employment from a big chunk of that $58 billion will be very small.

Mr. Deans: There may be some decrease and net loss of employment.

[4:30]

Hon. Mr. McKeough: In fact, I suppose it could be argued that with some of the machines and equipment there may be some decrease, I think marginal, in employment. But I would doubt that it would be more than the normal growth in the industry and the number of vehicles produced. I don’t think that’s a large cause for worry as there is a greater productivity and a greater output per man hour, but it does make it essential, and this is what we attempted to point out; and did point out, I think rather effectively a couple of months ago in the paper, which we produced in Treasury and which we tabled and which we have sent to the various companies. We’ve had no formal response from Ottawa on that paper. We’ve had no formal response, interestingly enough -- in fact no response at all from the motor vehicle manufacturers. The parts people essentially agree with it; and after sorting away a few facts and figures the United Auto Workers agree with that paper.

I’m not here to defend every figure in that paper one way or another. It was part of a contribution, and it is important to remember also that we in Ontario do not have access to all the figures. The figures are available only to the government of Canada, and I suppose the government of the United States under the automotive pact. Some of what we do and some of what we think is based on educated guesses, and sometimes they’re better guesses than not.

What I would like to say I will do, in the context of a brief presented to us the other day, last Monday, by the United Auto Workers -- I won’t give you their answers to the questions they pose, because they can do that in their own good time and in their own language and in their own way; but Mr. White -- and without equivocation I say that Mr. White presented the position of that large and powerful and strong union very well and very intelligently, and with a great deal of understanding of not only his problems and the problems of the members of his union but also I think, with a real understanding and concern for the needs of this province and the needs of this country, and I am glad to have this opportunity of putting those thoughts on the record as part of my contribution this afternoon. It was an excellent presentation and we had a very good discussion.

He posed, or the UAW had posed, three questions: First of all -- this isn’t in order -- are we calling for negotiation of the auto pact as the only alternative? My answer to that is, of course, no. I’m not suggesting that there should be a renegotiation of the pact; I don’t think there needs to be, I’ve never been of that view. I think, frankly, it’s a red herring if people say we should renegotiate the pact. I think what we have to do is find ways to get the parties to the pact to recognize their moral if not their legal obligations under the pact.

I suppose there’s a bottom line. I don’t contemplate that bottom line. The bottom line is that at some point, if we weren’t successful in our entreaties or our suggestions or our pounding on the table or whatever, we could go back to manufacturing our own cars in Canada, which frankly I don’t think is the most realistic proposition in the world. I doubt that the Canadian people would probably pay the price to have a separate and Canadian-only automobile industry. I don’t think, frankly, that’s a viable alternative; but I suppose that is the ultimate, that is the bottom line. The renegotiation of the pact per se, in my view, is a non-starter.

The second question -- and they asked it narrowly; I’ll broaden it a bit -- does the policy of the UAW not run into conflict with the interests of American workers and of the United Auto Workers in the United States; and within Canada isn’t there friction between Ontario and Quebec workers over new facilities? I’ll give members their answer; they said not. I would agree with that at this moment in time. I would agree with that; and there are many -- who would not label themselves continentalists, who would not label themselves free traders -- there are many who would say that for the continued health, prosperity, growth, economic well being and quality of life of men and women in North America, north and south of the border, we should be working towards -- the phrase often used is more “mini” auto pacts in a number of areas.

I don’t know enough about this, although the idea certainly has some appeal from a layman’s point of view, of which I’m one in this area; but certainly unless we are to try to build a wall -- heaven forbid -- around either Canada or the United States, or North America collectively, then there is no question that one of the largest problems we have facing us is the low wage, and increasingly high technology competition from the Third World, from the LDCs and so on.

If we are to go on competing, and competing well without the benefit of high tariff walls or higher tariff walls, then we are going to have to be efficient; we are going to have to have the full economies of scale, and in some instances -- not in all instances -- that is probably going to mean achieving some of the economies and efficiencies in other areas that we have achieved over the last 10 or 12 years -- witness international Harvester in Chatham -- in other industries and other sectors of our economy.

I would say that what we need to do in North America is look at this problem intelligently, do our damndest to settle it intelligently for the best interests of our people north and south of the border, be it the Ottawa River or the Great Lakes. It is important to do so, not just because of the automobile industry but because I think there’s some possibility that for our own good, both of us probably have to be looking at some other arrangement in other areas as well. That’s the very key significance of solving this problem.

Many of us in this House -- perhaps more from my part of Ontario than that part of Ontario from which the leader of the third party comes, but I see my friend from Essex is here -- many of us from our part of Ontario particularly have as many friends and relatives on the other side of the Detroit River as we have on our side of the Detroit River. We know many of the people who work in automotive parts plants, in automotive plants in Detroit particularly. They’re nice people. I think they’ve got as big a problem as we have. It’s all very well for Governor Rhodes to entice people from Detroit to Lima. What does that do to Detroit? I think that’s fundamentally as big a problem as enticing them from Windsor or from Niagara, to Montreal, to Lima or wherever.

I don’t think this is a problem that, frankly, can be looked at from the point of view of Ontario or from the point of view of Quebec or Ohio or Pennsylvania or New York state or Michigan. I’m not interested -- and I think my friend from Hamilton Wentworth (Mr. Deans) nodded when I said there may not be that much growth and then what we’re trying to do is hold our own -- I’m no more interested in seeing people having to move, or going out of work in St. Catharines and moving to Valleyfield, than I am in seeing people having to move or going out of work in Detroit because something new is opening up in Lima. I can’t honestly believe that it is in the best interest of the companies themselves -- Canadian or American or international: I can’t honestly believe that it is in the best interests of the governments of Canada or the United States, or Michigan or Ohio, Ontario or Quebec, to get into that kind of a game and say: “Because we can do a little better here than we can there, let’s open here and leave it a bit”; and that, “This one’s in danger over here,” and then hope that people will move backwards and forwards.

I simply can’t believe -- I refuse to believe -- that that makes some sort of sense in a North American, let alone in a Canadian, context. I’m not interested, and I say this, I’m no more interested in seeing a new General Motors plant in Chatham or Woodstock if there is some danger of taking some jobs away from St. Catharines. I’m not interested in that at all, and I certainly wouldn’t be interested if it’s going to cost something from the public purse.

The final question the United Auto Workers asked, and to which I address myself: does our policy not require us to support corporate incentives in order to respond to the pressures of particular groups of workers who see this as the only way to some jobs? The UAW can speak for themselves, and did and will. My position has been laid out. There was some suggestion here that there is some difference of opinion between the Minister of Industry and Tourism (Mr. Rhodes) and myself. Sure there is.

Mr. Laughren: Is he speaking this afternoon?

Hon. Mr. McKeough: Difference of opinion is honest. His job is to promote industry, often in a sectoral sense; I have to worry about the economy as a whole. There hasn’t been a difference of opinion. We both said from the beginning when it comes down to the crunch, and that is what was said this morning, if all else fails --

Mr. Deans: You won’t.

Hon. Mr. McKeough: -- if Canada is not prepared to assume its obligation, knowing that Canada and Canada alone has the levers, then I am not going to sit by and watch our industry go down the drain. On that score, the Minister of Industry and Tourism, myself, the Premier, these benches, are of one mind; make no mistake about that.

Mr. Laughren: You didn’t provide the leadership because of that, Darcy.

Hon. Mr. McKeough: Having said that, have no doubt of the fact that I have been quoted as saying that on a scale of one to 100, giving money to Ford, General Motors or Chrysler ranks about 99th on my list of priorities.

Mr. Cassidy: And yet you are doing it.

Mr. Breaugh: Make it 101, it will have more impact.

Mr. Deans: What happened to the other 98?

Hon. Mr. McKeough: My list of priorities, if we are going to do things in this country, would include energy projects, would include Ontario Hydro; would include perhaps assisting the steel industry, for example, I would rank it as a Canadian industry, and as a basic industry, ahead of the automobile industry. So let me make no pretence that this would be high on my priority list.

Let me make this clear: we are not talking about a matter of regional development, for which I have some responsibility. If it were a question, and let’s make that clear, of spending some money to get Ford or Chrysler or anybody else to establish a plant in Arvida, or Shawinigan, or Sudbury, or Kenora, it would be an entirely different debate. What we are talking about is Valleyfield; Detroit, Michigan; St. Catharines; St. Thomas; Windsor; Lima, Ohio.

Members opposite have pointed out that one of the highest rates of unemployment in this province at this moment in time, today, is in the Niagara Peninsula. If we are talking about regional development, if we are talking about what the Department of Regional Economic Expansion should be doing, then we would be looking at the Peninsula among other places.

Mr. Laughren: Oh come on, pass the buck again, Darcy.

Hon. Mr. McKeough: But we would not be looking at Montreal any more than we would be looking at Toronto, or even Oakville.

Mr. di Santo: You are responsible for the economy of the province.

Hon. Mr. McKeough: We just will not contemplate those sort of things.

Mr. Cassidy: But you’re doing it, you’re making the offer.

Hon. Mr. McKeough: That is not because we are talking about Montreal; we are talking about -- and I support Michelin going to Nova Scotia and I would support that again; as a Canadian, those are things we should be doing. I think I have some sympathy for the Americans trying to get industry into North and South Carolina, but I really have not supported and will not support public subsidies to try to put more employment in the middle of Metropolitan Toronto or next door to Metropolitan Montreal. I just don’t think that is what regional development as I have understood it over the years, is all about.

Mr. Laughren: You had better listen to the economic council.

Hon. Mr. McKeough: I think that is something that needs to be put on the record.

Mr. Cassidy: Better see what your leader was saying today.

Hon. Mr. McKeough: I want to mention just two or three other points, Mr. Speaker, and then I will wind up.

Mr. Laughren: Leave some time for the Minister of Industry and Tourism to speak.

Hon. Mr. McKeough: Make no mistake, we as a cabinet agonized over this; we agonized long. We have not accepted the figure of $75 million. That would have to have been looked at much more closely, obviously. Nor could we accept as a cabinet that we were saying we would do something for Ford, but General Motors, Chrysler and the whole parts industry, and Harvester and American Motors could wait until some sort of a policy was developed.

That was the reason for the Telex which went out on Wednesday to Mr. Horner, prudently putting a limit on it and saying: “If you want to go ahead with your three to one scheme, okay. Reluctantly, we come in. We will not only come in for the specific Ford case, but if there are other investments which you think are critical and which we think are critical we will come in on the same basis, three for one, up to a maximum of $75 million.”

[4:45]

I am told that today in the House -- I haven’t seen this and perhaps I shouldn’t be saying it -- Mr. Horner said the 75-25 split, for anything more than on the $30 million, was not a factor. That is not my recollection of the situation. People in the media have spent the better part of a month and a half trying to find out what my version of a meeting between Mr. Parizeau and Mr. Chretien, at which I was present, was all about. I am not going to get into that one.

But I will put the facts on the record whenever I am asked about how Mr. Horner has flip-flopped on this issue, and so has the government of Canada in the last three days.

Mr. Laughren: Those former Tories are the worst.

Hon. Mr. McKeough: It is incredible, simply incredible, what they have done to turn things around -- for what reason, I honestly don’t know.

Mr. Cassidy: So have you.

Hon. Mr. McKeough: No, we have not.

Mr. Cassidy: I have the quotes here; you are doing what you vehemently opposed.

Hon. Mr. McKeough: There is no way we have flip-flopped.

Mr. Laughren: You tried to.

Hon. Mr. McKeough: You know, the members opposite sit over there and they pontificate continually. They gyrate; we dominate. We dominate this debate on behalf of the people of Ontario, and my friend shouldn’t forget it. We know exactly what we are doing in this.

Mr. Mackenzie: That says a heck of a lot for you.

Mr. Foulds: You are selling out and you know it.

Mr. Mackenzie: God help us if you know exactly what you’re doing.

Mr. Deans: Actually, Darcy, when you get to this level, you nauseate.

Hon. Mr. McKeough: We have been at this for two and a half years. We have played our cards. We know what we are talking about. We are interested in employment. We are interested in the taxpayers’ dollars.

Mr. Mackenzie: How come you have made such a mess of it, if you knew what you were doing?

Hon. Mr. McKeough: I have never understood the NDP position. I never knew what the Grit position was until the Leader of the Opposition walked outside the House and, two minutes later, said “Give them $37.5 million.” If that’s his idea of how he thinks this province should be governed, he couldn’t be more completely wrong. I say to the Leader of the Opposition, who wanted this debate this afternoon --

Mr. Foulds: No, he didn’t. The New Democratic Party wanted this debate.

Hon. Mr. McKeough: -- for once in his life, keep cool, just keep cool; don’t go out here and say, “Let’s spend another $18 million.”

Mr. S. Smith: You keep your cool, Darcy.

Hon. Mr. McKeough: Does the Leader of the Opposition deny that’s what he said to the press? You know, I say to the Minister of Health (Mr. Timbrell) and to my other colleagues, I know the Leader of the Opposition is embarrassed about Jack Horner, but he really went overboard today to look after his Grit friends in Ottawa.

Mr. S. Smith: Take your time.

Hon. Mr. McKeough: They back down, they switch around, and the Leader of the Opposition says Ontario should put up another $18.5 million. I think that’s going to make great reading.

Mr. S. Smith: It certainly will.

Mr. Laughren: All noise.

Hon. Mr. McKeough: The Leader of the Opposition and Jack Horner can go to bed tonight with the great satisfaction that they are of one and the same mind; and boy, that is a cross my friend is going to carry for a long, long time. It is all his.

Mr. S. Smith: We’ll soon see about that, Darcy. Keep cool.

Hon. Mr. McKeough: The Jack Horner of the Ontario Legislature -- the Leader of the Opposition should be really proud of himself.

Mr. S. Smith: You and John Rhodes still haven’t got the same position.

Interjections.

Mr. Speaker: Could we have some order now, please?

Hon. Mr. McKeough: Mr. Flip-Flop has really outdone himself today.

Mr. S. Smith: Mr. Speaker, it seems to me we have a very important matter in front of us, a matter which was presented to this Legislature rather hastily by the Minister of Industry and Tourism, whose viewpoint was expressed almost diametrically opposite to that which we have just heard from the Treasurer.

Hon. Mr. McKeough: Not so and you know it.

Hon. B. Stephenson: That’s not true.

Mr. S. Smith: The Treasurer regards giving money to these large automobile companies to locate in what are obviously not DREE-identified areas -- and I agree with him; I can’t imagine why the area around Montreal should be identified as DREE, when St. Catharines and other places are not -- as being very low -- 99th, I think he said -- on his list of priorities.

Hon. Mr. McKeough: You are number 100, just so you knew.

Mr. S. Smith: It’s a lot higher on the Ministry of Industry and Tourism’s list of priorities, because he said to us very plainly today that they have decided some Ontario participation in automotive investment incentive schemes was necessary, particularly in view of the importance and timing of the investment programs.

He also said to us that he was afraid that since the Ontario government was willing to offer $18.5 million, or $17.5 million, and the government of Canada has demanded $35 million, or $37 million, that we are now going to lose the Ford plant. He says on the bottom of page four of his statement: “I am very much afraid that the Ford plant will now be lost.” I believe him. I presume he rose in this House to speak the truth. I feel, therefore, that I want to make certain remarks regarding this situation.

We have a real dilemma in front of us, first of all a dilemma in understanding the statement made by the minister. He refers early in his statement to the fact that an attempt is being made to attract a GM plant to Quebec with approximately $80 million, $60 million of which is being put up by the federal government. He points out that that is on a 75-25 per cent basis. I guess his feeling, which I must say I share, is that if such an agreement can be made to attract an automobile plant to an area around Montreal, then surely the very same type of agreement could be formulated to attract such a plant from another automobile company to an area of high unemployment in the province of Ontario.

I would like to point out that the history of this whole matter of the Ford plant -- and let’s stick to that for the moment -- is, as pointed out on page one, that when the 75-25 per cent proposal was made for a $30-million incentive, the government of Ontario could not come to an agreement among itself. It could not reach agreement, and consequently had a period of indecision. During that time, for some reason -- and I can’t imagine what the objection is -- apparently Ottawa went ahead and made an offer of $30 million to Ford entirely with federal money.

That was an interesting thing to have done. I don’t understand it, but apparently that was done, because on page three of the minister’s statement he points out that the Canadian incentive offer might be increased from $30 million to $75 million. So, I presume that Canada offered $30 million. I don’t think the government is objecting to that, but again I may be unclear about that.

In any event, we then go on in the minister’s statement and we find that some position was taken, very different from what the Treasurer has just outlined, for a so-called non-DREE designated program for areas not designated by the DREE program. This would provide assistance, according to the Minister of Industry and Tourism, amounting to one third or one half of that available under DREE. We are not told what the basis of that is. It said that the federal official suggested the provincial participation might follow the 75-25 formula proposed in the Ford offer.

Now we have the key statement. On the bottom of page two of his statement, the minister says: “Some Ontario participation was necessary. Our principal concern, however, was related not to competing with Ohio, Michigan or New York, but with our sister provinces.” They didn’t want to get into some kind of bidding war with other provinces. I can’t imagine what the minister is talking about. Perhaps he will explain it at some point. Surely if he is talking about a non-DREE program of 75-25, that would have been of uniform type across the country. The redefinition of a DREE area is certainly something which should be undertaken, but that’s not referred to here. I don’t understand that in the statement.

The minister is not in the House and neither is the Treasurer. For the record, let it be shown that on this occasion there is precisely one minister in the House, accompanied by two backbenchers from the government. That is the total turnout from the government side.

Mr. Mancini: One for every $10 million.

Hon. Mr. Bennett: The Liberals just equal the rest.

Mr. S. Smith: The statement points out they were then told by the federal government that the Ford company said that if the Canadian incentive offered could be increased from $30 million to $75 million, the facility might come to Ontario. The ante was increased at that point. At that point, despite the protestations of the Treasurer, the Ontario cabinet sent to the federal government the telegram referred to, in which Ontario offered to participate on a 25 per cent provincial, 75 per cent federal basis to get the $75 million. The Treasurer has now stated in this House that he is not sure of the $75-million figure. It’s right in the Telex they sent to the federal government, so somebody must have been sure of it or he wouldn’t have put it in the message.

At that point it seems the federal government, for some reason I cannot fathom, decided that only a 50-50 contribution plan would be acceptable as far as determining the origin of the incentive to draw the Ford company into this country and into Ontario. I see that the government has decided that they cannot go along with this. They could go as far as the 25 per cent in giving money to the very wealthy Ford Company, but they would not go as far as the 50 per cent.

Somehow, it’s reminiscent of the story of George Bernard Shaw who was talking to a famous Lady Somebody-or-other. At dinner he said: “Tell me, would you consider going to bed with me for a million pounds?” She said: “For a million pounds I just might.” Then he said: “Would you consider doing that with me for one pound?” She said: “What do you think I am, a prostitute?” He said: “That’s already been determined. All we’re arguing about is the price.”

Let the Treasurer not come in here and pontificate to us. Let him not come in here and say that he doesn’t want to give money to the auto companies, something he has 99th or 100th on his list of priorities. His government has offered 25 per cent of the $75 million incentive, but has balked at going to 50 per cent.

Hon. Mr. Bennett: It was 25 per cent of the federal offer.

Mr. S. Smith: I will read, for the benefit of the Minister of Housing, who has difficulty with that activity --

Hon. Mr. Bennett: Please don’t read it to me. I think I have things in hand as well as you do.

Mr. S. Smith: I’m quoting from the government’s statement: “Ontario will participate with the federal government on a 25 per cent provincial, 75 per cent federal basis in an investment incentive offer of $75 million to the Ford Motor Company.” Read it.

Mr. Ruston: It’s far more than a condominium in Toronto.

Mr. S. Smith: It’s obvious now why the minister who has just spoken is no longer Minister of Industry and Tourism; the numbers are too much for him.

Hon. Mr. Bennett: You need not worry, you will never be in that position.

Mr. S. Smith: The government of Ontario has already agreed that it would be willing to have the 25 per cent contribution from the province to entice the Ford company here but they balk at 50 per cent.

Frankly, I can understand why they’re upset. It’s not right that Quebec ought to be able to attract automobile plants and the federal government go in on a 75/25 per cent basis, whereas Ontario was told that all we can have is a 50/50 basis. I can appreciate the feeling of the government about this. But if the minister is telling the truth when he says that this plant is about to make a location decision in the United States, if he’s telling the truth when he says: “I am very much afraid that the Ford plant will now be lost”; I do not understand why the government has chosen to allow this Ford plant -- $500 million and 2,000 jobs -- to be located in the United States if that is what it truly believes will happen, merely because they are angry with the federal government for giving Quebec a better deal than Ontario. It’s most regrettable that the federal government has done that. I will condemn that in the strongest terms and I don’t have to take any second rank seat to the Treasurer in this regard.

Mr. Cassidy: Then you will go under.

Mr. Foulds: It will be just like you; you’ll cry rape when you are being ravished.

Mr. S. Smith: If you don’t like the government in Ottawa, you can certainly vote against them if you wish. The people will have that particular option very shortly, I suggest. But I’ll tell you this, they are in power at the moment whether we like it or not, and to cut off our nose to spite our face would have to be about the dumbest possible thing to do at this time. We need a $500 million plant.

Hon. Mr. Bennett: They made the offer and we responded.

Mr. S. Smith: We need 2,600 jobs in this province. We’ve already decided to go down this rather slippery slope, a dangerous one indeed, of giving money to these companies; as much as it’s a regrettable thing to be held up to ransom like that we’ve decided to do it.

Hon. Mr. Bennett: At least we agree on that.

Mr. Smith: Why stop at $17.5 million when for another $17.5 million or so we can get the $500 million plant on Ontario soil and create the 2,600 jobs?

Hon. Mr. Bennett: Your federal friends made the deal and we responded.

Mr. S. Smith: I’m proud to say that’s the policy of the Ontario Liberal Party.

Mr. Foulds: When in doubt chicken out, that’s the policy of the Liberal Party.

Mr. S. Smith: I wonder, sometimes, if the government really wants this plant here. I wonder, sometimes, if the government might not have some preference for seeing us lose the plant so they can go around the province this summer and say: “Look how dreadful it is that Quebec is always the spoiled child in confederation. Look how dreadful it is that they’re getting the -- ”

Mr. Foulds: The Liberal policy by definition is a contradiction in terms.

Mr. S. Smith: “ -- La Prade heavy water plant.” Wouldn’t that be a nice runup towards an election on an issue where one can recollect certain language issues which arose in this House not long ago?

Hon. B. Stephenson: No, no.

Mr. S. Smith: If you want the plant, it’s obvious how to get the plant.

[5:00]

I want to read into the record a letter that I have sent to the Right Honourable Pierre Trudeau dated today: “My Dear Prime Minister” --

Mr. Foulds: That ought to do it.

Hon. Mr. Grossman: My dear cousin.

Mr. S. Smith: “The Ontario Minister of Industry and Tourism, Honourable John Rhodes, today reported to the Legislature certain negotiations which have been going on concerning the location of a new $500 million plant of the Ford Motor Company. It is his contention that since the Ford company was offered some considerable incentive financing to locate in the United States, the Canadian government has recommended that an incentive be offered to have the plant located in this country.

“We have been told that the Ford Motor Company originally wanted $30 million and that the government of Canada expressed a willingness to pay three-quarters of that cost provided the government of Ontario paid one-quarter. Mr. Rhodes went on to say that while the government of Ontario was still deciding how to respond to this offer, the federal government assured Ford that the $30 million incentive would be available. We are told, however, that Ford responded somewhat later by saying that $75 million would now be the necessary level of incentive.

“Mr. Rhodes reports that the government of Canada then rescinded its original offer to pay three-quarters of an incentive and that it insisted that the government of Ontario pay approximately 50 per cent of the necessary incentive to attract the Ford plant. I regret to have to tell you that this change in federal policy is very disturbing to the official opposition in the Ontario Legislature. The economy of Ontario and of Canada is heavily dependent upon a healthy and modernized automobile industry and it is clear that we are in great need of this half-billion-dollar facility, which would create 2,600 jobs.

“Furthermore, the fact that incentive arrangements have been offered by the federal government for a General Motors plant to locate in Quebec is being well publicized in Ontario and it is felt only fair that the same terms of assistance be made available in this province, where, even in many areas of southern Ontario, unemployment is at least as high as it is in the province of Quebec, and I may say particularly in the area around Montreal.”

Mr. Cassidy: There goes regional development.

Mr. S. Smith: “In the interest of economic development and of national unity therefore, I strongly recommend that the federal government maintain the terms of its original offer to Ontario, namely a three to one sharing formula with the provincial government.”

Mr. Foulds: Why wouldn’t you do anything to save the jobs in Sudbury?

Mr. Cassidy: You wouldn’t come up with a nickel to help the workers at Inco.

Mr. S. Smith: “May I add that we are all quite dismayed that it has become necessary to enter a ‘bidding war’ to obtain what is, after all, only our fair share of new capital investment by the large auto maker. It is evident that we are now paying a penalty for having permitted our auto industry to be totally continental in outlook and American in control. I would hope that every political means possible would be used to persuade the auto industry to put a fair share of capital investment into Canada based on sales volume in this country and based on a proper sense of responsibility as corporate citizens. You may note that I have urged the government of Ontario to accept your offer of a 50-50 split in the incentive to Ford. This is not because I agree with it -- ”

Mr. Cassidy: Well, why did you offer it?

Mr. S. Smith: “ -- but simply because I am fearful that the Ford Motor Company would otherwise imminently decide to locate this vital plant in Ohio or Pennsylvania. I am convinced, however, that the federal government should by rights go back to its original position of a three-to-one split and I would ask you to give serious consideration to this request. Best wishes. Yours sincerely, Stuart Smith.”

Hon. Mr. Grossman: Love and kisses, your cousin Stuart.

Mr. S. Smith: I put it to you, Mr. Speaker, that what we are faced with in this House is a situation where we have an opportunity for 2,600 jobs and a half a billion dollar plant. Regrettably, things in the auto industry are in a situation where the auto makers are demanding what amounts to blackmail and to ransom, but it seems that the government has already assured them, has already assured the auto makers --

Mr. Cassidy: And you offer to pay.

Mr. Foulds: You offer to pay.

Mr. S. Smith: -- that it is prepared to go as far as $30 million from the federal government, that it is prepared to go, from the provincial government as far as a quarter of $75 million; these governments are now haggling over the remaining $17½ million or $18 million. I say to you, Mr. Speaker, that for a $500 million plant, for 2,600 jobs --

Mr. Foulds: I think you should have gone and played a little tennis, Stuart. Those old flip-flop days are back.

Mr. S. Smith: -- by rights we should be treated as fairly as Quebec. I, personally, deplore in the strongest terms the fact that we are not being given equal and favourable treatment. If the Ford company is going to make a decision to put the plant elsewhere and we are to lose 2,600 jobs because of this political wrangling that’s going on at the moment, that would be a tragedy for the working people --

Mr. Foulds: The old flip-flop, no-principle days are back again.

Mr. S. Smith: -- it would be a tragedy for our economy, it would be tragedy for the future possibility of providing employment for the young people of this province. The proper thing to do right now is to continue fighting with the federal government, but to make certain we get that plant in Ontario, to ensure that whatever money is necessary for that will regrettably have to be provided, given the realities of today’s circumstances, much as I dislike and deplore these realities.

Mr. Warner: Are you related to Henry Ford?

Mr. S. Smith: The political wrangling can go on after we have made sure that plant is located in this province. I do not accept that simple statement in the minister’s statement, “I am very much afraid that the Ford plant will now be lost.” That’s too great a sacrifice to make at this point. The realities, unfortunate as they may be, are nonetheless realities. Politics should be put aside and we should be certain to get that point into Ontario.

Mr. Cassidy: We have had an extraordinary afternoon already. We have had a flip-flop by the Treasurer and the government. We have evidence of a flip-flop by the federal Ministry of Industry, Trade and Commerce.

Mr. S. Smith: And now we are being treated to a flop.

Mr. Cassidy: We have the Liberal Party abandoning every principle it has ever had.

Mr. Kerrio: We have a plain ordinary flop from the leader of the third party.

Mr. Cassidy: The New Democratic Party has been concerned about our not getting our fair share under the auto free trade agreement for a very long time. Today’s announcement, both by the Premier and by the Minister of Industry and Tourism, simply confirmed what we feared all along.

Mr. S. Smith: Read Hansard of March 3.

Mr. Cassidy: The strategy adopted both by Queen’s Park and by the federal government in Ottawa in relation to the automotive industry is bankrupt and is not working.

Hon. Mr. Bennett: Why don’t you get some new lines. We have heard the same from you for so long.

Mr. Cassidy: The Minister of Housing is concerned about what has been done in cabinet; so are we. The evidence is that the Ontario government itself doesn’t really know what policies this province should be adopting with regard to future investment and production in the automotive industry. I want to talk about that as well as about the jobs at Ford.

Even though the auto industry is the most important industry in the province, and even though auto-related activities count for one job in every six in Ontario, there was barely a peep out of this government for years after the auto pact was signed back in the mid1960s. There was barely a peep about the state of the industry, its future, its prospects or its contribution to the strength of the industrial economy of this province.

Finally, just two years ago, the Treasurer introduced some analysis about the auto agreement in the budget. But there was no follow-up even then. Only in recent months, prompted by pressure from the New Democratic Party --

Hon. Mr. Bennett: That will be the day.

Hon. B. Stephenson: Absolutely balderdash.

Mr. Cassidy: -- and prompted by pressure from the automobile workers, have the Premier, the Treasurer and the Minister of Industry and Tourism begun to take a close and serious interest in this industry.

Mr. S. Smith: Read Hansard of March 3.

Mr. Cassidy: As New Democrats, we accept some of the analysis and findings which the government has come up with. We welcome the study by the Treasurer, which was tabled at our instigation and which showed that if Canada had had a fair share of investment, of research and development and of production, that two years ago we would have had 25,000 more jobs, $866 million more in investment and an additional $200 million in research and development here in Canada.

Mr. Kerrio: We’d have to go on a spending spree. We wouldn’t know what to do with the money. The NDPers would, though.

Mr. Cassidy: That’s what we are losing because of this country’s failure to get a fair share under the auto free trade agreement.

For a time it looked as though the government was making a commitment to the fair share concept and against the corporate incentives which the automobile companies had been pressing for with such vigour, both here and up in Ottawa. In fact, as recently as April the Treasurer made a speech down in Chatham in which he said: “Frankly, we in Ontario are against getting into fruitless, wasteful and unnecessary bidding wars of special subsidies and tax incentives. Moreover, it would undermine the spirit of our agreement with the United States.” The Treasurer has said as much again today, but then he has gone along to endorse the position of his government, which is to give the incentives to which he says he is adamantly opposed and disinterested.

The fact is that we face a grave situation for the future. If current trends continue, our auto trade deficit will climb to $2.5 billion in 1985 from the current level of just over $1 billion a year.

Mr. Kerrio: What are you going to do about this plant?

Mr. Cassidy: In the parts industry, we are now suffering a $3-billion deficit every year, and that is having an enormous negative impact both on jobs and on our economy.

As the background paper that was published today indicates, if we are denied a fair share of the $60 billion of new investment which is now anticipated in the industry over the next seven years, Canada -- and that means mainly Ontario if we talk about the auto industry -- will be shut right out of the next generation of energy-saving aluminum and plastic-based vehicles.

Because of our declining share of investment in the 1970s, we have already been left behind; there is no time to lose if we are to catch up.

By the Premier’s own reckoning, Mr. Speaker, if you take the figures he has given in the House today, in a three-year period from 1977 to 1979 we have commitments for only $100 million from GM, $250 million from Ford and $10 million from Harvester; that is a total of $360 million. Our fair share of the $60 billion investment over the next eight years would be about $6 billion over seven years, or close to $900 million a year. We have commitments for $120 million a year, which is more than $700 million short of what we should be seeing in investment in this vital industry to Ontario’s future.

We have been concerned about the way the government has been handling the situation. This province has failed to use its potential influence to make sure we get a fair share of production and jobs and investment. Today we have learned that on the most fundamental question of all, whether we try to buy jobs or whether we try to get them on a fair-share basis, the Ontario government has capitulated, as has the Liberal Party, and has abandoned the position which was so firmly being taken by the Treasurer just two months ago.

Mr. Kerrio: Tell us what you are going to do, Mike.

Mr. Cassidy: Yes I will, as a matter of fact. If I can put it another way, the position up until a month ago was that --

Mr. Kerrio: What are you going to do, nationalize General Motors?

Mr. Cassidy: -- Ontario was not prepared to enter the bidding game but that the Ontario government was not going to press very hard to do anything else. We got into the poker game during the past month and we got suckered by the Ford Motor Company and the other companies in the Big Four.

Mr. Laughren: Shameful.

Mr. Cassidy: Two weeks ago, despite what was being said in public, the province indicated privately that Ontario would participate in the federal incentive program. There was no indication that Ontario try to suggest any alternative approaches. Just this week, at the time the UAW was talking to the cabinet and saying they supported the government’s opposition to the bidding game, in fact Ontario was in the bidding game with both feet. It seems as though they thought they had won; in fact the new investments were busily going out the window.

That is precisely the behaviour we can expect from multinationals every time we try to make these kinds of financial offers and try to buy jobs. When I asked the Premier today if Ontario had prepared an analysis of the Ford company’s incredible contention that it needed $75 million to justify locating its new engine plant expansion in Ontario, he failed to indicate just what information Ontario had, or whether we had any information at all. This party does not accept that after the devaluation of the Canadian dollar and after the findings of the auditor’s report the figures that Ford has put are real at all.

We know the tendency for the government to be too easily persuaded by the words of their friends in the business community without subjecting every claim to the closest and harshest of scrutiny. We do, however recognize that when Ford increased its request to $75 million that was the straw that broke the camel’s back. Jack Horner could not go quite that far because it would have made our regional expansion incentives in Canada ridiculously ineffective. Ontario finally drew the line when it was asked to participate in incentives on a one-for-one basis rather than on a one-for-three basis.

As for the future of the Ford plant, today’s announcement may itself be another play in the game; we will have to see. What we do know is that the incentive now being offered means that we are trying to buy jobs at the rate of $28,500 per job for the most profitable and one of the largest industries on the North American continent. We in the NDP, of course, count on Ford to locate that plant in this province, not because of financial incentives but because that is the company’s moral obligation under the automotive free trade agreement.

The essence of what has been announced today, however, is this: Ontario has published a background paper with valid analysis that its intention is to justify giving investment incentives. In the paper Ontario says the current potential inequities under the auto pact must be addressed and that we must constantly remind the leaders of the auto industry in North America of our determination to have those inequities corrected. Alas, Ontario has made no specific steps to ensure that will happen, beyond the offering of incentives.

[5:15]

Secondly, we are now firmly embarked on a route of investment incentives through the largest and most profitable corporations in North America and already the signs are very clear of how disastrous that policy will be. Within a week of Ontario indicating what it would do, General Motors came along and pulled back on its commitment to go into Quebec because it heard that federal funds might be available. Now it’s reconsidering its position completely and doesn’t even know whether that investment will go into Canada at all. That’s a clear indication of what’s going to happen every time a major automotive investment is contemplated in the years to come.

Once the auto companies know that money is available to them from this government or from Ottawa, they’re going to come here with their begging bowls in hand and there will be no alternative but to fill up their cups at the expense of the ordinary taxpayers of this province and of this country.

We are opening ourselves up, not just to the auto industry but to every major industry, to having companies which will decide to come into Canada first or decide to come into Ontario and then, having made their decision, come up here to see by how much we will sweeten the pot.

Mr. Swart: Who governs Ontario?

Mr. Cassidy: That’s right. Who governs Ontario?

The Arthur report indicated our productivity is high. The Arthur report indicated that the cost of investment in this province is about the same as in the United States. The Treasurer himself has indicated that our corporate tax package is a lot more attractive -- for reasons we happen to have some misgivings about -- than in the competing states in the United States, yet we make these offers.

If this happens in the automobile industry, which is one of the most productive and efficient in our country and a mainstay in our economic growth, I predict this will happen as well in other major industries which also have absolutely no reason to apply for corporate welfare.

Should our steel industry get this kind of investment incentive? We say no. Should our machinery industry get this kind of corporate incentive? We say no. Our plastics industry? We say no. We’ve surely had enough of these incentives under this government already. Surely we don’t need any more.

Hon. Mr. Bennett: If you’re so smart, go ahead and spell them out.

Mr. Cassidy: Surely the time has come to draw the line and make industry live up to its corporate responsibility.

Hon. Mr. Bennett: Why don’t you tell the House what you’d do about job creation?

Mr. Acting Speaker: Order.

Mr. Mackenzie: Mr. Speaker, control the donkey over there.

Mr. Cassidy: The minister had to leave the Ministry of Industry and Tourism, because he was so incompetent in that job.

Hon. Mr. Bennett: I didn’t leave it. I volunteered to go into Housing to try to improve it.

Mr. Cassidy: The Liberal policy is to give these handouts. The former Minister of Industry and Tourism’s policy is to give these handouts.

Hon. Mr. Bennett: You are wrong again, Michael.

Mr. Acting Speaker: Order.

Mr. Cassidy: The Treasurer says the handouts being offered by the federal government and by Ontario are a key to industrial policy in general. In fact, they’re a key to the sellout of every taxpayer in the province.

Hon. Mr. Bennett: Your party should know. You’d nationalize them.

Mr. Cassidy: I want to point out that the workers who are most directly affected by this, the United Automobile Workers of America, who were here talking to the cabinet on Monday -- and these are the people whose jobs are on the line -- said specifically: “We are opposed to corporate incentives as a general policy for essentially two reasons: one, because it transfers income to those who are rich from those who are poor” -- in other words, it’s unequal and unfair -- “and two, because every experience everywhere in the world shows that this kind of bidding for plants will not work.”

The auto workers know the experience in Windsor, where Chrysler was forgiven $17.5 million in import duties in order to build a new truck plant just two and a half years ago. And what do we get? Two years later we get a truck plant shutting down and going to the United States. That’s the success of the kind of corporate bidding which is going on right now.

Hon. Mr. Bennett: The success of the auto industry has added substantially to the economy of this province, and you’ve taken advantage of it every time.

Mr. Acting Speaker: Order.

Mr. Cassidy: It’s not as though we don’t have any clout here in Ontario. We have clout in this province and we should use it.

Mr. Swart: You’d give them the key to the Treasury, Bennett.

Hon. Mr. Bennett: You fellows would take the key and rob it.

Mr. Cassidy: Canada purchases 1.3 million cars and trucks every year. Four fifths of those vehicles are North American. Three quarters of those vehicles bought are imported from the United States. Canada, especially Ontario, is one of the richest and most profitable for automobiles, outside the United States, in the entire world. That is the prize to which the Big Four and their subsidiaries now are being given not only generous access but also are being offered further corporate welfare handouts.

We in this party also believe in getting jobs in this province. That’s why we believe the auto industry must be given priority as part of an industrial strategy for Ontario and that we must get a fair share of the jobs, the production, the investment and the research. You can’t do what the Treasurer does and blame Ottawa alone. Ontario must share the responsibility. Ontario has to provide leadership in seeing that we achieve that fair share.

There are a number of specific proposals I would like to propose today. First, we should make it absolutely clear that we are opposed to the bidding game of incentives which is allowing automobile companies like Ford to blackmail this province. That approach is bound to be self-defeating and must be rejected.

Second, Ontario should take on a role of leadership in ensuring that the automobile companies live up to the spirit of the auto pact and of the commitments they entered into when the pact was originally signed. The auto pact has given the Big Four and the subsidiaries enormous advantages in growth and profits. Canada deserves to get its fair share. We should seek new commitments from the companies which would update the spirit of the original free trade agreement of 13 years ago.

Third, Congress has been monitoring performance under the auto pact for the past 13 years to look after American interests. We should be doing that in this country in order to look after Ontario and Canadian interests.

Mr. Nixon: They have been finding it so bad they want to pull out.

Mr. Cassidy: Fourth, we should be protecting the jobs in the industry now. We should be protecting workers against the layoffs that the companies are imposing on them. We should protect workers whose incomes are affected by the layoffs, as we did originally with the transitional adjustment provisions under the automobile free trade agreement.

Mr. Ashe: Would you throw out the auto pact?

Mr. Cassidy: We should take the lead in getting all jurisdictions out of the competitive bidding game. This is important. Specifically, Ontario should press the federal government to file grievances under the auto pact against the incentives now being offered by US states to lure investment away that should be going here.

Mr. Kerrio: Take them to court and I’ll believe you.

Mr. Cassidy: The Americans told Ed Broadbent when he was down in the United States just two weeks ago that if we offer incentives, they will have no hesitation in filing grievances against Canada. We should do that when they offer incentives that are undermining the spirit of the auto pact.

Six, Ontario should also take a lead in bringing the automobile-producing states and provinces together in a joint effort to restore some reason to a situation of competitive incentives which could bankrupt all of us. It could bankrupt the jurisdictions involved. It will bankrupt our taxpayers and the taxpayers of the American states which are involved. The only winners are going to be the big four automobile companies that are making the rounds.

Finally, we have legislative clout as well and we should be prepared to use it.

Mr. Mancini: Sure, close them down, nationalize them.

Mr. Cassidy: I want to remind you, Mr. Speaker, that we now have the largest single industry in this province, in this continent, which is turning out cars with dramatically increased fuel economy and with a dramatic change in the size, nature and engineering of those cars, because of legislative decisions that have been made by legislators in the United States and which have been followed by federal legislators here in Canada. If that change is possible in the industry, then we too can and should use our legislative clout in conjunction with the federal government.

There are areas, such as research and development, where we can insist that that be carried out here in this province or in this country; as well as marketing, sourcing, where they get their people and where they do their business; there are a number of ways and areas in which we can and should explore using legislative powers where necessary in order to ensure that the basic concept is met, which is that we get a fair share of production, of investment and of jobs in the automobile industry here in Ontario and in Canada.

The problem we are facing with old party governments, whether we’re talking about Tories and Liberals in Ontario or talking about Liberals and Tories up in Ottawa, is that they do not know how to come to grips with the basic problems of the economy as a whole.

Hon. B. Stephenson: That is absolute stupidity, really.

Mr. Cassidy: If they can’t cope with the economy as a whole, they cannot cope with the automobile industry, which is one of the major areas.

Hon. B. Stephenson: You know nothing about it.

Mr. Cassidy: We in this party are committed to use every means possible to ensure we get the fair share for Canada and for Ontario, and that the kind of scandal that’s occurred today, the kind of blackmail that we’re seeing from the Ford Motor Company, is not allowed to occur in the future.

Hon. B. Stephenson: You’re going to scrap the auto pact and destroy 100,000 jobs.

Mr. Cooke: We don’t have an auto pact; you’re buying them off.

Mr. B. Newman: I rise to make a few comments concerning this debate. Seeing as I do come from the birthplace of the automobile industry in Canada, I am extremely concerned. Likewise, when one looks at the original auto trade pact and reads article 1, section c, which says: “It shall be the policy of each government to avoid actions which would frustrate the achievement of the objective of a fair share of the market”; one would conclude from that that both countries involved would not undertake any type of practices that would be detrimental to one or the other.

Back in February 1978, the present Conservative government, in its meetings with the Prime Minister, signed a communiqué that said the federal and provincial governments would provide incentives and take measures to ensure a proportional share of the increasing investment in the new plant for the automotive industry in Canada, so the decision to provide incentives was made by this government back in February of 1978, quite some time ago.

Hon. B. Stephenson: That doesn’t necessarily mean money.

Mr. B. Newman: My own community has been hard hit as a result of rationalization in the auto industry. We had an unemployment index of approximately 12 per cent, almost 12,000 unemployed, in the earlier part of the year. Since then that position has been ameliorated a bit and our unemployment index at this time is approximately 10 per cent. The auto trade pact at this stage has adversely affected the city of Windsor, because all of those jobs or most of their jobs were associated with the auto industry.

Chrysler did develop a van plant in the community, for which we are extremely appreciative. However, by the same token it did remove the six cylinder engine plant, it phased it out and is substituting for that the heavy engines, the 351cc engine if I am not mistaken. What they have done is, the popular engine has disappeared, the jobs that would have been associated with that have disappeared and they have been replaced by a big engine, which will mean fewer jobs and as a result we have some unemployment from the elimination of the six cylinder.

Chrysler has also decided that it would remove the truck plant. They are closing out the truck plant completely. There is a loss of some 750 jobs there. Four hundred of those jobs are gone practically permanently. About 350 will be able to be transferred to the van plant if the van plant continues to operate at full capacity, as it is doing right now.

One of the problems with the auto trade pact is there is no uniform data base. When we talk to GM, we find one set of figures; we talk to Ford, we find a second set of figures; we talk to the federal government, we get a third set of figures; we talk to the provincial Treasurer, and we have a fourth set of figures. There is no uniform data base, so we can’t compare apples with apples and oranges with oranges. We are having statistics provided by each of the different organizations, governments or companies that cannot be compared one with the other.

We want our fair share. As much as we consume, we want at least that amount of employment in Canada. We want that amount of employment as we produce. I think we do have our fair share when it comes to automobile assembly, but when it comes to the parts manufacturing we are at a disadvantage. I have noticed that the city of Detroit has bid for the retention of the Chrysler plant. They have offered all types of incentives so that they would stay in the city of Detroit. As has been mentioned by previous speakers, the state of Ohio has also done that.

One of the things we are going to have to worry about in the future is that the auto industry can move into the Philippines and will only have to pay five per cent of the wages that they pay in North America. They work in the Philippines for 40 cents an hour, so we are going to have to be extremely concerned that some of these undeveloped countries don’t take us right out of the market completely.

Mr. Breaugh: Mr. Speaker, I want to take a slightly different view of the automotive situation and the auto pact itself. For one thing, we are drowned in statistics in this. The background paper that was tabled in the House this morning is a succinct document. It’s sad but it is succinct. It tells a very sad tale of a sector of our economy, a prominent sector of the economy, that’s well on its way down the drain already.

[5:30]

Let me take a very quick overview of what is happening in that industry. I happen to represent a riding that is strongly dominated by a multinational corporation which functions basically in Oshawa and in St. Catharines. We are looking at some old buildings; we understand that there are some options to land developers that have already been exercised and some others that are being considered. We are looking at plants that have used the exemptions provided by this government to put new machinery into their plants, and we fully understand that those exemptions eventually mean a loss of jobs.

We understand, as well, that certain types of operations in parts and service and CKD, a complete knockdown unit, which traditionally has offered a service to the employees as well as to the company -- that is, when you can’t stand the pace of the production line there are other types of jobs being offered by the company -- those types of jobs are sadly diminishing. We are seeing people with 20 and 30 years of seniority being put back into a production line. And, unfortunately, we know that they won’t be there for long. They are people with bad backs and bad knees and they won’t withstand the pace of the production line for much more than six or eight months and then they will be off on compensation; even though previous to this they would have been able to end their working career profitably and with some satisfaction.

So we see some change in the employment patterns there. We see a buffer that was there for the employees going out the window. We also see a multinational corporation that has its production levels up, at record levels, in fact, but we do see the type of work being restricted and we see the total number of jobs, in effect, being reduced. We can see other examples of this; GM, as an example, at the Hayes-Dana plant in Thorold has gone from 2,500 to 1,500 employees. I guess the most dramatic in the province would have to be Prestolite in Sarnia; once a thriving industry, now virtually out of business.

Those things are in the back of our minds, and we are well aware that in our own local example we have certain types of production which may not be in Oshawa for very much longer. When we look at the federal government, functioning in whatever secretive way it wants, the end result is a good deal of distrust and a fear that we have not only General Motors to battle any more, but also the federal government and maybe another province in our own country. Those are difficult times for us to face in Oshawa.

In Oakville, we see again recurring disputes over overtime; whether we will take the same number of employees and the same production facility and work that thing to the nth degree so that we suffer a loss of jobs, and we also suffer the kind of working conditions that massive amounts of overtime does provide.

In Windsor, we can see 950 employees affected by what is going on in the automotive industry. We can soften that if we want, and of course various people do say that is not really 950 jobs, that is 750 jobs, and that really only 300 jobs will be lost, but we have to take into account that people’s employment records are affected by this; some totally, some to a degree, but the same thing happens. What should also be of some concern there is that several small parts vendors will be out of business because production facilities are moved.

In Brampton, in the Premier’s own area, I think we see the most dramatic one. I am not sure there is a Big Four any more. There is maybe a Big Three and a Half. We look at American Motors shutting down and changing to production of type of vehicle that is -- to be polite about it -- very faddy. What do we do when the fad in the American market ends, and people don’t want Jeeps like they do now? How many four wheel drive units can this continent hold?

Hon. B. Stephenson: They don’t want their cars either.

Mr. Breaugh: What will we do with them? Eventually, like the hulahoop, they may not be quite so popular. At that time, unfortunately, we will see our production facilities geared to producing this type of fad. We see it in Windsor, we see it in Brampton, and we see some efforts in the GM production facilities at Oshawa to do the same type of thing, so we will be manufacturing in the Canadian sector things which may not be quite as stable to the industry as ordinary motor vehicles.

We see that loss of jobs, and we see a trend in the industry to see the kind of non-saleable items are produced in Canada. That is unfortunate because in the automotive industry, when we talk about the Canadian automotive industry, basically we are talking about one province, and that happens to be us.

The auto pact itself was written with several corporate advantages in mind. It gave to them an access to the massive market. About 90 per cent of the vehicles we produce in Oshawa go south; and that is not particularly good or bad, but that is particularly of a distinct advantage to the corporation itself. It maximizes the use of facilities, and that is precisely what they have gone about doing.

It is crucial at this point in time, because there is about $60 billion being stuck into the automotive industry in the United States for a variety of reasons. We see specialization. We see more production facilities being located in Canada.

There is virtually no official monitoring of the auto pact itself done in a neutral way. There are virtually no penalties that can be applied to whatever happens in the auto pact. The end result is -- in my own area and across Canada -- we see less total employment than we had previous to the auto pact. We see a loss of any buffer to employees. We see there are no longer places where employees can do maintenance or service because we have only production facilities. We have really decimated the parts sector, and everyone agrees that about 25,000 jobs have been tossed down the drain in that.

In all of this we see a pretty sad thing. I want to conclude by asking the government to do some concrete things. I plead with the government to bargain with the corporations; don’t try to bribe them. It may sound like a great amount of money here; the Treasurer (Mr. McKeough) may be a most impressive minister in this House, large and loud, but in the board rooms of Detroit he couldn’t carry the coffee.

Mr. Kerrio: That is unparliamentary.

Mr. Breaugh: I think the most important thing is to get this government to pay some attention to the automotive sector; to make sure it doesn’t try to bribe multinational corporations with, in their view, rather small amounts of money. Represent our workers and represent our economy. We think we have convinced this government to be aware of the importance of the automotive industry in Canada. We would now like the government to do something about it.

Mr. Kerrio: Mr. Speaker, I rise to participate in the debate as it relates to my particular area of concern, because we certainly have a great many related plants in our area -- to get parochial just for the moment in opening -- with Ford glass plant and GM in St. Catharines, and Hayes-Dana at Thorold, on the outskirts; and some very large abrasive plants that are I think directly dependent on the industry -- Norton, Lionite and Canadian Carborundum --

Mr. Swart: Don’t forget Thompson Products.

Mr. Kerrio: -- and two or three electrical harness plants in the area.

Mr. Bradley: He only takes the ones with a union.

Mr. Kerrio: Certainly this is of grave concern, in regard to the auto pact, as to how it relates to any new building.

I am just a little disappointed that the member for Chatham-Kent, the Treasurer (Mr. McKeough), got sort of carried away. I thought if there was ever a time in this Legislature where at least the two parties that have come together and thought about how we should entice these plants to come here --

Mr. Cooke: Don’t you ever get carried away?

Mr. Mackenzie: Something like you last night, Vince.

Mr. Kerrio: The socialists have taken a stand, and on the short term I don’t think we can consider anything coming from them, because right now we are faced with the reality of coming up with funds to bring them here. As long as we are of the same mind, I am very disappointed that the Treasurer got carried away and really lost any kind of --

Mr. Ziemba: They should carry you away.

Mr. Kerrio: -- meaningful rapport with us. We should go united to the automotive industries in order to present our case. We should show some kind of solidarity, at least among most of the sensible-thinking people in this Legislature.

Mr. Warner: What a Tory prop. They could all leave and you would apologize for them.

Mr. Kerrio: I say that with respect. I am convinced that in the long term we should be looking for something in the auto pact that would more relate to a fair and equitable involvement, right from the design stage up through the plants that make the cars to the parts industry.

I think the whole auto pact has to be monitored, looked into and revitalized in a way that is going to accommodate the automobile industry to be able to build anywhere in North America and to make it more convenient for them to function. But also we should work for some kind of balance in the auto trade that will see to it that the roughly 10 per cent of the industry that should come to Canada and that part which should come to Ontario would finally end up where it belongs here. It’s only going to happen if the Treasurer gets co-operation from enough members on this side to go there in such a way that he can make the best kind of case.

Mr. Mancini: I am pleased to rise to participate in this special debate on the automobile industry. The central issue is whether we shall give direct government incentives to different auto makers, that is, shall the government give huge sums, millions of dollars of the taxpayers’ money, so that these auto makers can expand their operations here in the province of Ontario?

This is a very complicated matter. What complicates the matter the most is that one in every six jobs in the province of Ontario is directly or indirectly related to the auto industry. In my own riding, thousands of workers are employed by the auto industry. In 1975, just prior to the provincial election campaign, the Conservative government, which was desperately trying to hang on to power, gave away hundreds of millions of dollars by eliminating the sales tax on new cars sold. At that time, they had no qualms about this large giveaway of the taxpayers’ money.

Mr. Nixon: That was a $600 million policy.

Mr. Mancini: But now they are prepared to jeopardize the building of a $500 million plant in the province of Ontario. A plant of this size would mean millions of dollars in tax revenues and thousands of construction jobs, along with 2,600 permanent jobs after the completion of this plant. Even though I deplore this large giveaway, this $37 million we are requested to give to this auto maker, what are we going to do?

Mr. Warner: You will still do it though.

Mr. Mancini: How are we going to control the legislatures of Ohio and Pennsylvania? What answers do the socialists have to that? I say they have no answers at all.

Mr. Cooke: What do we have an auto pact for?

Mr. Mancini: The situation is very plain to see. We are being forced to participate in this bidding war. We are being forced by governments which are outside of our jurisdiction and over which we have no controls.

Mr. Warner: it is a giveaway.

Mr. Cooke: What do we have an auto pact for?

Mr. Mancini: This is a regrettable position. However much we detest the situation, we are going to have to go along with it in the meantime. I say what we should do is give the money and then take the appropriate steps in the immediate future to ensure that this never happens again.

Mr. Warner: You live in an unreal world.

Mr. Mancini: There are many ways this can be done. One of the ways could involve large amounts of these corporate shares being bought by our government

Hon. Mr. Timbrell: Which government?

Mr. Mancini: That government over there that never decides to act until it’s too late.

Hon. Mr. Bennett: We responded to your great friends in Ottawa.

Hon. Mr. Timbrell: Mr. Speaker, I just want to make sure what the honourable member is proposing is on the record, namely, the purchase of shares by the government.

Mr. Mancini: I see that my time is up. I was pleased to have been able to participate.

Mr. Bradley: I rise as a representative of a constituency that relies very heavily on the automotive parts industry for its economic viability. A majority of my neighbours and a very substantial number of the breadwinners in St. Catharines are employed by General Motors, Hayes-Dana Limited and Thompson Products and rely upon the location of plant facilities in the area for their livelihood. For this reason, I feel it is imperative that we in the province of Ontario take any reasonable action necessary to protect the present investment in automotive jobs and to attract all the new investment necessary to improve the employment situation in the province.

Hon. Mr. Welch: You’d better speak to those federal members down there.

Mr. Mancini: There’s only one Tory provincial member left.

Hon. Mr. Bennett: Note that the Premier is in the House.

Hon. Mr. Davis: They are going to lose their seats.

Mr. Bradley: For some months now, I have been aware of discussions that have taken place surrounding a possible plant expansion by General Motors --

Hon. Mr Bennett: Note that the Minister of Education (Mr. Wells) is in the House.

Mr. Bradley: -- and the fact that the Niagara Peninsula, which is presently experiencing a high rate of unemployment, might not have the same opportunity to attract this new General Motors investment as an area in Canada eligible for grants under the DREE program. To me, this is most disturbing. What is equally disturbing, however, is that at a time when the situation appears to call for a nonpartisan team effort to meet what is a very difficult challenge, we in this House are once again becoming mired in partisan rhetoric.

Hon. Mr. Welch: Only on that side.

Hon. Mr. Davis: Oh, come on. You’d better be careful about that.

Mr. Bradley: As the Premier and the Minister of Industry and Tourism spoke in the House this morning, I detected a sense of grave concern that this most regrettable bidding war was being lost because of lack of ammunition available to this province.

[5:45]

Hon. Mr. Welch: The federal member for Niagara Falls has done nothing. I said the federal member for Niagara Falls.

Hon. Mr. Davis: I am liable to quote what you said earlier.

Mr. Bradley: Without exception, members of the Legislature find the necessity to offer giant corporations large financial incentives to locate in specific areas -- a repulsive, distasteful development.

Hon. Mr. Grossman: Don’t believe everything Harold writes for you.

Hon. Mr. Davis: Harold is a little out of his depth on this issue.

Mr. Bradley: But it is being done, not only by our neighbours to the south but also by our sister provinces and the federal government.

Hon. Mr. Welch: The federal member for St. Catharines didn’t even know who the minister was.

Mr. Bradley: In the absence of any ironclad agreement on the part of the various political jurisdictions to avoid a bidding war, we find ourselves faced with the reality of stiff opposition and the possibility that we will not reap the benefit of the new investment.

Hon. Mr. Davis: Jimmy, you’ve got to read faster.

Mr. Bradley: What all members in the House surely agree upon is that if the federal government feels compelled to enter into the financial incentives battle, we in this province should be offered an equal opportunity to compete for the new jobs.

The danger for my riding in any future expansion plans lies in the new technical developments that could eliminate jobs --

Hon. Mr. Welch: And the riding of Brock.

Mr. Bradley: -- in St. Catharines and Brock. If a new aluminum engine plant is located in the United States, or in another Canadian locality, what will be the effect on the foundry in St. Catharines, which uses grey and malleable steel products? If there’s a movement to front-end drive vehicles, as scheduled for 1981, what will happen to the jobs in the GM rear-axle division?

Hon. Mr. Bennett: Good question.

Mr. Foulds: Spineless Stuart Smith sold out.

Mr. Bradley: These are questions the workers of my constituency might legitimately ask.

Hon. Mr. Welch: And they should ask the federal members down there.

Mr. Bradley: A good deal of the problem lies in the provisions of the auto pact as they relate to the parts division of the auto industry. The belated Reisman investigation may produce some results but they will not be useful to us in the present situation.

I find it unfortunate that the Treasurer, after presenting the problems and options in a reasoned, forthright manner, chose to conclude his excellent speech with some unfortunate partisan invective. We are not completely united in this House on the precise method of meeting a very crucial situation.

Hon. Mr. Bennett: We are united in this party.

Mr. Bradley: However, we are united in our concern and our desire to get our fair share of auto plant expansion. Let us not allow this issue, at this point, to deteriorate into a political, partisan wrangle.

Hon. Mr. Bennett: Okay, Jack Horner.

Hon. Mr. Welch: You’ve had two or three months to do something.

Mr. Bradley: Let us, as members of this House, support any efforts that the Premier feels are necessary, any efforts that the Minister of Industry and Tourism feels are necessary, to bring the necessary plant expansion to here in Ontario. All we ask for is our fair share. We in this Legislature are united in that goal.

Mr. Deans: Mr. Speaker, we may be united in attempting to get a fair share of the auto industry wealth for Ontario --

Hon. Mr. Welch: Dispense.

Mr. Ruston: Take it as read.

Mr. Deans: Thank you very much -- the jobs and all of the other benefits, but we’re not united in the method that should be used.

This morning, when the matter was raised, I said to the Premier that this is robbery and we’re being ripped off and, in fact, we are. I want to say again to him that we can’t create economic stability with giveaways; we can’t create long-term employment for the province with giveaways, and we can’t afford to begin now or to continue this ridiculous bidding war that the government is starting.

Hon. Mr. Davis: You’re quite right. Nationalize the automotive industry and we will all be out of work.

Hon. ii. Stephenson: We didn’t start it.

Mr. Nixon: Let’s move to increase the time limit on this debate.

Mr. Deans: Okay. Let’s have a look at it, because, let me tell you --

Mr. Kerrio: Are you going to nationalize General Motors?

Mr. Mackenzie: Do you only know how to follow the Tories, Vince?

Mr. Deans: I sat so quietly, listening to --

Mr. Speaker: The previous speaker did an excellent job of just ignoring the interjections.

Mr. Deans: There were no interjections.

I want to suggest to the government that we simply can’t begin this bidding war. It’s a never-ending, downhill, careening problem that we’re going to be faced with time after time.

Mr. Kerrio: It’s already happened; you’re too late.

Mr. Deans: What do we do when Westinghouse knock on our door and tell us that unless we provide them with money they are going to go back to the United States? Or when General Electric come and tell us likewise? Or when General Motors come and say that if we don’t provide them with some kind of subsidy, off they go? Or when American Motors, in the Premier’s own home town, come and say that they’ve got a problem and if we don’t give them money, they’re going to move to some other part of the world. Or if Peugeot come in and say they’d like some money from Ontario? Or perhaps Datsun will tell us it’s always better if we own a Datsun; therefore, we should provide them with Ontario tax dollars in order to get some favour.

If this was one of these poor operations that couldn’t afford to withstand the necessary capital investment out of its own income capacities, then I would say to the Premier that we might take a look at it. Maybe we should look at taking an equity position to guarantee that there will be some return to the people of Ontario. But we’re talking about a different kind of company.

Hon. Mr. Davis: Ian, the greatest mistake your party made was not making you leader.

Mr. Deans: We are talking about a different kind of company; and let me just say to you, since I don’t have a lot of time; we are talking about a company that has wealth beyond belief, a company capable of creating here in Ontario and in Canada sufficient wealth to enable it to reinvest, that makes quite clearly by the record on an earnings per common share here in Canada substantially more than it is able to make in the United States on the same product.

This is a company that in the last five years has made $568 million of net profit after taxes here in Canada. In 1977 its earnings per common share in Canada was $4.43, the lowest in the last decade. In 1976 the earnings in Canada were $15.21, in the States $10.45. In 1975 the earnings were $14.45, in the States $2.44. The earnings in Canada in 1974 were $18.60; were $3.86 in the United States. But if you go back to 1972 the earnings in Canada were $15.77 per common share, only $8.52 in the United States.

Mr. Nixon: Slower, I am taking notes.

Mr. Deans: What in heaven’s name are we doing trying to bribe a company to come in here, where they can make earnings far in excess of those that they can make in any other part of the world?

Hon. Mr. Davis: I don’t think you should ask heaven to make these determinations.

Mr. Deans: What are we saying? That we have to not only give them the benefit of all these substantial gross earnings for their own use while in the United States, where you tell me they are going to go and where they are not going to make more than one third of the earnings there that they are able to make here in Canada --

Mr. Martel: They want the bank.

Mr. Deans: -- that they want us not only to provide a climate that we have provided --

Mr. Mackenzie: They know where the suckers are, Ontario and Quebec.

Mr. Deans: -- a climate for making the kind of money that they have been able to make here over and against what they were able to make in the US, but that they want us now to dig into the treasury and provide them with handouts?

Hon. Mr. Grossman: Tell your colleagues.

Mr. Deans: Well, I want to tell you something. You can’t win in this game. We are not big enough to win in this game. If we try to take on the United States in terms of giveaways, we are bound to lose.

Mr. Kerrio: We did it before, Ian.

Mr. Deans: But the end result of all of this will be that after they have drained us dry, as they have over the years, they will then turn around and they will move anyway; and you know, as I know, that by far the vast majority of the dollars that will be invested in Canada will not in fact create a net increase in the numbers of jobs.

Hon. Mr. Davis: Your policy has changed; read the note.

Mr. Deans: No, my policy hasn’t changed. My policy is exactly the same, and what I am saying to you is this: --

Hon. Mr. Welch: You sound like a socialist.

Mr. Deans: This is not an appropriate step to take. If there were any justification at all --

Hon. Mr. Davis: Well, listen: You have advocated incentives. Look at Hansard.

Mr. Deans: -- for being involved in any way in providing capital for the Ford Motor Company to locate anything in Ontario, for heaven’s sake, do it on an equity basis. If the government is determined that --

Hon. B. Stephenson: But your leader in March suggested that we should.

Mr. Deans: -- we should involve the capital, the tax dollars of the public of the province of Ontario in any corporate undertaking, for goodness sake make sure that there is a rate of return to us from that investment that will justify the investment. That’s good government. That’s even good Tory government.

Mr. Speaker: The honourable Premier.

Mr. Martel: The last hurrah!

Hon. Mr. Davis: I will be here in October.

Interjections.

Hon. Mr. Davis: Mr. Speaker, they are interrupting me.

Hon. Mr. Grossman: The members opposite will be glad they waited.

Interjections.

Hon. Mr. Davis: I will try in these very few minutes left to put this total issue in perspective so we will all understand it.

Mr. Martel: Are you ever lucky. Always the spotlight on you. That is called the unbiased press.

Hon. Mr. Grossman: That tells you something.

Hon. B. Stephenson: No, no. It is that heavenly glow.

Hon. Mr. Grossman: Let Hansard show the lights went on.

Hon. Mr. Davis: As I listened to the discussions I have come to one or two conclusions: first, that some members aren’t totally aware of the entire problem; second, that the New Democrats really aren’t too sure where they are on this issue. The Liberal Party of Ontario wants to be all things to all people again and wishes to give away the store in the process; --

Mr. Cooke: It’s your party that flip-flopped.

Hon. Mr. Davis: -- that much I’ve learned in this brief debate.

Mr. Martel: More crud.

Hon. Mr. Davis: I want to make just one personal observation to the member for Oshawa. He talked about a riding about which I know somewhat. If he wants to say to the people who are members of the UAW in my community that American Motors made a mistake in introducing the Jeep into that community he should go out and talk to those fellows, because some of them will disagree with him.

Mr. Breaugh: All right; fair enough.

Hon. Mr. Davis: That decision -- I am speaking now in a very parochial sense -- may add a degree of stability to American Motors in our community that has not existed to the same extent in the past few years.

Mr. Breaugh: Tell me that three years from now.

Mr. Mackenzie: I wonder if it will be like Northern Telecom?

Hon. Mr. Davis: All right, he can knock it, he can say it’s wrong; but I’ve got to tell him some of his own colleagues in the UAW think it’s not such a bad arrangement.

Mr. Mackenzie: Tell us about Northern Telecom.

Mr. Breaugh: What choice did they have?

Hon. Mr. Davis: I would say to the member for Oshawa that this is probably a better solution than the one that presently exists. If he knocks it, be my guest; all it means is that I get a few more votes from his colleagues in the UAW in my community. I appreciate it very much.

I also want to say this: I regret the leader of the New Democratic Party isn’t here, but I listened to his rhetoric and I listened to the distinguished member who should have been leader in his last few remarks. I can only say you people can’t have it both ways. You can’t have the member for Nickel Belt saying to the Minister of Industry and Tourism; “When are you going to get into the game in incentives?” and the implied observation was very simply this --

Mr. Foulds: He didn’t say that.

Mr. Martel: He didn’t say that.

Hon. Mr. Davis: Do the members want me to read it to them? If they want me to read it to them I will read it to them very simply.

Hon. Mr. Grossman: This should be interesting.

Hon. Mr. Davis: “Supplementary: Mr. Speaker, in view of the fact that there are as many as 25,000 jobs, $866 million worth of investment at stake” -- where he got this from, I don’t know -- “in these negotiations, doesn’t the minister think it is time the province of Ontario got off the sidelines and into the game?” There is only one implication --

Mr. Foulds: What nonsense.

Mr. Martel: Boy oh boy, are you reaching. You are scraping the bottom of the barrel.

Hon. Mr. Davis: -- the member for Nickel Belt wants to put the government into the auto business. Certainly he does, as does the member for Windsor-Walkerville.

Hon. Mr. Grossman: How else would you interpret it?

Hon. Mr. Davis: What did Michael Cassidy say? What did Brother Cassidy say? Did he say whether Ontario has made any specific initiatives to counter the apparently lucrative offers from the states in the United States? What does he mean by that? Of course, he means incentives. You know, somebody told him, “The party line has got to change,” and you guys came in and as a result you don’t deal with reality.

Hon. Mr. Welch: I think you’re getting to them.

Mr. Foulds: Initiatives. Initiatives. Does that mean give away the store? Nonsense.

Mr. Martel: This is the lowest of the low. Boy. Initiatives are now subsidies and giveaways. Bull roar.

Hon. Mr. Davis: Oh, come on. You guys love to whistle and blow at the same time. You’ve been doing it all of your political careers, and you are not going to get away with it. I’m glad the member for Nickel Belt is here. See what he said earlier.

Mr. Martel: The phrase is “suck and blow.”

An hon. member: The Premier’s time is up.

Hon. Mr. Davis: No, I’ve got 37 seconds left. Mr. Speaker, can I just really sum up? This government is not enthusiastic about the incentive game. We are faced with a particular problem as it relates to one particular plant at this moment. I have read the letter that the Leader of the Opposition has sent to his very close friend and personal associate, the Prime Minister of this country; very close friend. They are the people who have helped complicate this issue at this precise moment. There is no way the federal minister can say one day it is 75-25, and then we find the upper limitation is $37 million. That’s not the way to do business, and those people across the floor have to assume some responsibility because of their very close association with them.

Mr. S. Smith: What nonsense, what nonsense. They don’t ask us, for God’s sake. If they would ask us we would tell them how to govern. They ask you more than they ask us.

Hon. Mr. Davis: Oh, come on. Listen, the leader of the opposition and Pierre are so close they are like twins. What I haven’t found over there yet is a comparable person to Jack Horner. That hasn’t really occurred to me yet.

Hon. Mr. Welch: There’s only one Horner.

Hon. Mr. Norton: Speak to your buddy Jack Horner, Stuart.

Mr. Martel: You do need a vacation. He needs a vacation, I want to tell you.

Mr. Foulds: Don’t get your hair ruffled, Bill; run your hands through it.

Hon. Mr. Davis: This government has taken a constructive and positive attitude to this problem. We are attempting through our dealings with the industry to see that we get our fair share of investment. The government of Canada put $30 million on the table with respect to Ford; we are prepared, and I won’t back away from it --

[6:00]

Mr. Foulds: Where is the Treasurer?

Hon. Mr. Welch: He is writing a cheque.

Mr. Martel: He is writing a cheque for $30 million.

Hon. Mr. Davis: We are prepared to involve ourselves in the 75-25 program, but it has to have application right across the board and not just for one particular industry, not just particularly for the Ford Motor Company. We have made this position very clear to the government of Canada.

Mr. Cassidy: Are you justifying this kind of corporate welfare? Is the Treasurer writing the cheque right now?

Hon. Mr. Davis: I see the member for St. Catharines is nodding his head in agreement because we’re helping to bail him out of an inactivity on the part of the federal government in his riding, and he well knows it.

Hon. Mr. Welch: That’s right, because the federal members down there have done nothing.

Mr. S. Smith: And you think you will get a majority?

Mr. Cassidy: You will hear a lot more about this.

Hon. Mr. Davis: I’m delighted with this debate, but I’ve got to tell you, Mr. Speaker, it isn’t finished. I’m not concerned about majorities. I’m concerned about offering good government to the people of this province. I don’t let my own personal ego interfere --

Mr. S. Smith: It’s the language issue, isn’t it?

Hon. Mr. Davis: -- with that responsibility, which is something that the Leader of the Opposition should learn.

Hon. W. Newman: What he is saying is you should put yourself on the couch.

Mr. Foulds: Time.

Hon. Mr. Davis: The problem of the Leader of the Opposition is that he’s beginning to believe some of his own press clippings. That’s a fundamental error. He should never make that mistake.

Mr. S. Smith: You’re reading them pretty carefully these days, aren’t you?

Hon. Mr. Davis: I’m not debating language here today.

Mr. Martel: You are not debating anything.

Hon. Mr. Davis: Just go across this province -- and I notice you haven’t done it making whatever observations yon want to make in the field of language. I can only say to the Leader of the Opposition to do so. Go ahead.

Mr. Sweeney: You’re using the situation for political purposes.

Hon. Mr. Davis: But I should caution him, let’s do it in a non-partisan sense, which he has not done to date.

Hon. W. Newman: Sock it to him.

Hon. Mr. Davis: It is now 6 o’clock. Could I say in final conclusion that I appreciate the observations of the members opposite. Before I sit down and before the House leader moves the adjournment of the debate, may I extend to all members opposite my sincere appreciation for their co-operation on many issues, their limited co-operation on some issues --

Mr. Deans: Jesus.

Hon. Mr. Davis: -- and wish them all a very pleasant vacation. We will see them here again in October.

Mr. Foulds: I don’t believe it.

Mr. Sweeney: You need a recess. You need a vacation after that.

Hon. Mr. Davis: For three minutes what do you do? You take 10 minutes and you still don’t get warmed up.

Hon. Mr. Welch: The Premier put the issue right on the record for the peninsula, and he did it very well. Those four federal Liberals in the Niagara Peninsula will be shivering tonight -- shuddering tonight. There’s no doubt about it.

Mr. Nixon: Will you pull yourself together, for God’s sake?

Mr. Speaker: Order. I would like to wish all members a very peaceful, harmonious, contented summer recess. When we reconvene in the fall, perhaps you’ll be a little bit more generous and a little less intemperate.

Hon. Mr. Davis: Mr. Speaker, on a point of order, are you referring to beer in the ball park?

Mr. Laughren: A by-election in Brampton.

On motion by Hon. Mr. Welch, the House adjourned at 6:05 p.m. until a date to be named by the Lieutenant Governor by her proclamation.