Legislative Assembly of Ontario

The House resumed at 8 p.m.

COMPULSORY AUTOMOBILE INSURANCE ACT (CONCLUDED)

Resumption of the adjourned debate on the motion for second reading of Bill 160, An Act to provide for Compulsory Automobile Insurance.

Mr. Speaker: Does any member wish to speak to the bill? The member for York North.

Mr. Hodgson: Mr. Speaker, I don’t see a quorum.

First Clerk Assistant: There is not a quorum, Mr. Speaker.

Mr. Speaker called for the quorum bells.

On resumption:

Mr. Speaker: Do we have anybody who wishes to speak to the bill on second reading?

Mr. Renwick: Mr. Speaker, I have two or three comments I want to make on second reading of Bill 160, An Act to provide for Compulsory Automobile Insurance.

To the very best of my ability, I will try not to repeat what has been said before about the origins of the bill or the reasons why it is presently in the assembly.

I would, however, in my own small way pay a tribute to some of the people who worked with us in the committee on company law dealing with this area, particularly the minister’s advisers, the superintendent of insurance and his staff, throughout a long period of time. We have had so long an association with the three reports on insurance, the present report on insurance and a previous report dealing with the law of trust companies, that the superintendent of insurance and his staff approach us with a certain care and wariness about what we’re about. We’ve got to know each other and we’ve also got to know how we go about the process of coming up with the kind of legislation which in due course will be acceptable.

I would also like to comment on the presence of the consultants who were here this afternoon, Mr. Paul Boddy and Miss Ludmilla Jagiellicz who have worked with us for some considerable time entirely in the insurance field. The work they have done on all three reports and the work they’re presently doing in the field of life insurance have been invaluable to the work of the committee. It is reflected in these two volumes dealing with automobile insurance.

I couldn’t let the opportunity go by without referring to the late George Ness, who was counsel to the committee for the two reports dealing with automobile insurance. At the end of his time as counsel to the committee, he probably was aware he wasn’t going to live very long and he was not with us when we were working on the third report. Ultimately, he died at a much younger age than he should have. I did want on this occasion to pay a tribute to the work which he did for the committee over such a long period of time, both prior to the work on hospital insurance when he was associate counsel to the committee and then when he was counsel to the committee. I want to pay tribute to his work on these two reports which ultimately have led to this particular piece of legislation.

Let me turn for a moment to the legislation. I am not going to spend very much time on the report. Anybody who wants to read that model of English prose, known as the dissent of the member for Sudbury (Mr. Germa), the member for Scarborough-Ellesmere (Mr Warner) and myself, will easily recognize that while it doesn’t have any particular Churchillian ring to it, it does compare somewhat with, shall we say, the Gettysburg address in the model of concise expression of a dissent which is irrefutable, and which says all that has to be said in the clearest possible way about what will take place in the province in a few short years, even under a Tory government, that is the introduction of a government automobile insurance plan.

As a matter of fact, I can see this minister at the last gasp of a dying Tory government nailing to the masthead that the Tories are going to bring in a government-sponsored plan in order to stave off ultimate defeat before a New Democratic Party victory at the polls.

If I may now turn to the bill and two or three things, the bill has a certain semantic intrigue to the title of it. Having looked at the reports recommending compulsory automobile insurance and seeing the bill which the minister introduced into the House to deal with compulsory automobile insurance, one would think there would be some resemblance in the bill to what is in the report. There are certain minor similarities between the recommendations in the report and what is in the bill, but that’s about all.

In introducing the bill, the minister referred to it in an almost punitive way, as if we were going to make people take out insurance. That was not the purpose of the committee. The purpose of the committee, given a private automobile insurance system in the province, was to provide the assurance that anyone who wished to drive a car would have available to him automobile insurance at a price which, subject to the risk which he was bringing to bear on the pool of people who were driving automobiles, would be at least bearable, so that he wouldn’t be priced out of the market and so that he would not be in a situation such that he couldn’t drive because he couldn’t afford the insurance policy. For a long time that has been one of the hallmarks and one of the bad things about the automobile insurance system as it existed in the province.

We now have a Facility Association which is so close to being a government-operated plan that it might well be very close to a total operation of such a plan that may very well develop from this Facility Association.

The crux of that association, if I may so refer to it, and the principle of the bill, is that an agent shall provide to an owner of a motor vehicle who is a resident of Ontario an application for automobile insurance and submit to an insurer a completed application for automobile insurance when requested to do so by the owner of a motor vehicle. Having submitted it, of course, it is then up to the private marketplace, the individual company, to pick up that particular application and to issue the policy. But the safeguard for the resident of the province is that the association shall ensure, through its members, that a contract of automobile insurance is provided with respect to every application for automobile insurance submitted under the plan to an insurer under the section I have just quoted.

[8:15]

Very simply, if an individual insurer in the province will not pick up that application the association is obligated to find an insurer within the association who will pick up that application and issue the policy; that’s the protection which is finally available in the province.

I’m warning the minister, and I’m warning him now, that our experience showed the number of policies which find their way into an insurance corporation facility such as this, or into the previous pool, reflected very clearly the capacity of the insurance industry to absorb the business. High risk insured persons were looking for insurance through the Facility and paid the penalty of the higher premium; but there came a point where the capacity of the industry was shrinking and a great many relatively normal risks were finding their way into this so-called pooling arrangement for the issuance of policies to cover those persons.

I’m saying to the minister that unless he monitors the operation of that Facility Association very carefully, and I think the elements to provide for that monitoring are in the bill, we may very well find the capacity of the insurance market may contract over a period of time and a number of people will find their way into that association looking for policies who would otherwise be serviced in the private market. The minister has a very real responsibility for monitoring the operations of the Facility Association.

We have plainly provided an obligation on the insurers forming that association to file the rates and to get approval from the superintendent before those rates go into effect. I think I can say that the integrity and the knowledge of the superintendent’s office within the ministry of the government, coupled with what they have learned from their association with members of the select committee, would indicate it would be quite likely they will exercise stringent authority to make certain those rates are fair, equitable and at the lowest possible level.

I believe I saw in this bill a provision with respect to a report. I do not see the usual provisions that that report must be tabled in the assembly. It may very well be advisable when the bill is in committee to make such a provision so that it will be seen that this assembly has some sense of responsibility to make certain this new compulsory automobile insurance scheme will be monitored by the assembly, and if necessary will be available for scrutiny by some committee of the assembly should that committee so desire.

The other major element in our report not dealt with in this bill is the question of termination of insurance policies. We tried to devise a model scheme of compliance which, coupled with significant changes in the vehicle licence system from a vehicle licence registration system to a licence-owner or a plate-owner system, would have ensured that an insurance policy, once issued, would be irrevocable during the period the owner had possession of the plates for which he was covered and which he could use on his own automobile.

The ministry has chosen not to implement, at this time, that compliance model that was the recommendation of the committee. At some point in the future, if this interministerial committee which we heard about for so long ever makes a report -- and I haven’t heard that a report has been made -- it may be able to recommend the institution in the province of an owner-to-plate system of registration which will allow us to have the kind of model for the compulsory insurance scheme that is envisaged by the report of the select committee.

Just before I leave that particular section, I do want to say the procedure for the termination of a policy is not nearly as clear as we would have had it. The irrevocable nature of an insurance policy tied to a plate, would, in many ways, have eliminated a wide range of possible persons driving without insurance coverage. That, of course, was the goal of the system, but the minister has chosen simply to restrict the bases on which termination of a policy can take place by enumerating four particular reasons for termination, which are then part of the conditions attaching to the automobile insurance policy.

I assume at some point those four clauses will find their way into a condition in the policy so that a person reading the termination condition in his policy will be able to see that the insurer has only the rights of termination set out in the bill. I take it that is not a problem because of the regulatory power of the ministry. I’m certain when the minister stands to speak he will assure us those clauses will be incorporated in the bill.

I want to turn to my last comment on the bill, which is a concern I’ve expressed for some time on a number of occasions. It is the reference to the right of the constable, the police officer, to require to see the evidence of the insurance. It is still immensely confusing in the bill.

Let me refer very briefly to the comment that was made in the report. “The committee noted that the authority for police officers to stop vehicles and demand proof of insurance is contained in section 3 of the Motor Vehicle Accident Claims Act and in section 55 of the Highway Traffic Act. A review of the provisions of these acts is included in appendix F.” This is the second volume of the report on automobile insurance.

“The committee has concluded that there is value in setting out clearly in the Insurance Act the specific authority for police to stop a vehicle for the purpose of checking for compulsory insurance coverage and recommends that the minister makes such changes to the act.”

Let me just step back for a moment and relate it to the Highway Traffic Act. As this is a matter which in the opinion of some, including myself, at least touches upon the question of civil liberties in the province, I think it is time both the Ministry of Transportation and Communications and this ministry clarified exactly what the authority of the police officer is with respect to documentation which I, as a driver and operator of a motor vehicle, may be required by law to have in my possession and which he can stop me and require the production of in order to identify me or to assure himself that I am insured when I am driving that motor vehicle. The provisions are scattered and are far from clear. The Highway Traffic Act has never been amended to delete the term “constable” and to replace it with “police officer.” We therefore have in section 14 of the Highway Traffic Act this provision, “Every operator of a motor vehicle shall carry his licence with him at all times while he is in charge of a motor vehicle and shall produce it when demanded by a constable....”

There is no definition of “constable” in the act. There is, however, a wide definition of “peace officer” which is extremely broad and does include, among the enumerated heads, the term “constable.”

We have the first provision that if a person has an operator’s licence a police officer, on the wording of section 14 of the Highway Traffic Act, can require a person to produce the licence when demanded. Then in section 17 we have the identical provision related to a chauffeur’s licence, as distinct from an operator’s licence: “Every chauffeur shall carry his chauffeur’s licence with him at all times while he is in charge of a motor vehicle and shall produce it when demanded by a constable....”

Then in section 55 of the Highway Traffic Act we have this, again rather unusual, provision: “Every constable ... may require the driver of any motor vehicle to submit such motor vehicle together with its equipment and any trailer attached thereto, to such examination and tests as the constable or officer may consider expedient.”

There is no particular provision in any of those particular sections to which I have referred, either in section 14, in section 17 or in section 55, which says the police officer can stop a person.

As was stated in the report, we then have this provision in the motor vehicle accident claims fund section of the appropriate section: “The owner of a motor vehicle who operates or permits the operation of the motor vehicle on a highway shall, upon the request of a constable..., produce evidence that (a) the vehicle is an insured motor vehicle or (b) the uninsured motor vehicle fee has been paid in respect of the motor vehicle.” That will be somewhat changed, of course.

I did want to draw the attention of the House to these four provisions related to something called the production of documents to a police officer. The problem, however, is whether or not police officers can simply stop you for that purpose, or do they have to have some reason to believe that you are engaged in infringing the law before they can stop you and ask you to produce your chauffeur’s licence or your operator’s licence or to produce the evidence of insurance or to examine your vehicle?

That is not clear and hasn’t been clear for a very long time. I don’t know the answer to that. There may be lawyers who practise in the traffic courts -- although I doubt if many can afford to go into those courts these days -- who may be able to answer that. But I want to draw to the attention of the government that not just this minister, but also the Minister of Transportation and Communications (Mr. Snow) -- the two of them -- are operating a statute which appears to allow a police officer at random to stop a vehicle without reasonable cause that any offence is being committed.

[8:30]

In other words, if my colleague the member for Scarborough-Ellesmere, who is an impeccable driver, is simply driving from here to his home in Scarborough-Ellesmere, he can be flagged down by a police officer who can presumably say, “You are driving, Mr. Warner, in your usual impeccable style within the speed limit on the right side of the road. Your vehicle is in perfect functioning condition and you are driving in your usual temperate, sober condition, but we are out tonight and have nothing else to do, so we think we will flag you down and ask you to produce your operator’s licence or your chauffeur’s licence and evidence of your insurance.”

My colleague, being a person who stands clearly on his rights on occasion, might very well say to that officer, “But, officer, you have no right to ask me unless you can tell me that you have reasonable grounds to believe I was breaking some law while I was driving.” As you can see, it would not be long before my colleague the member for Scarborough-Ellesmere might very well be up on a charge of obstructing the police in the performance of their duties.

That is the kind of conundrum which the law presently allows to exist under the Highway Traffic Act and the Motor Vehicle Accident Claims Act. We are going to perpetuate that conundrum in the bill before us, because this bill specifically states in section 3 that an operator of a motor vehicle on a highway shall have in the motor vehicle at all times an insurance card for the motor vehicle or an insurance card evidencing that the operator is insured under a contract of automobile insurance, and the operator shall surrender the insurance card for reasonable inspection upon the demand of a police officer.

I wish I could see the lawyers equivocating as to what they really wanted to say when they put the word “reasonable” before “inspection” and not before “demand.” I would have assumed if they were trying to indicate there was some reason behind the request that the word “reasonable” would have been before the word “demand” and it would have read, “and the operator shall surrender the insurance card for inspection upon the reasonable demand of a police officer.” This bill perpetuates the confusion and compounds the problem I have endeavoured to draw to the attention of the assembly.

I think it is a problem which verges on infringing on civil liberties. It does so in my judgement, and raises serious problems. Now that we are adding a fourth provision with respect to this question of the production of documents to police officers on demand, it is time that this assembly made a clear statement of what it intends.

Do we intend to give police officers the right to stop drivers at random and ask to see their insurance cards and are citizens obliged to comply; or are we saying -- I am glad the Minister of Transportation and Communications is here -- that no, an officer can only make the demand if he has reasonable grounds to believe an offence has been committed under the Highway Traffic Act or some other kind of offence, and that ancillary to that anticipation he can demand the particular documentation?

The bill compounds the problem further. The Highway Traffic Act doesn’t define police officer, but defines peace officer to include a police officer as well as a constable. A police officer in this bill means the chief of police or other police officer or constable. I want to make certain that anybody looking into the minutia of what I have been talking about is aware that I purposely left out in all of my quotations the reference to a person appointed under section 156 of the Highway Traffic Act for the purpose of carrying out the provisions of that act. I wanted to make it perfectly clear that section 156 provides a specific authorization of a particular kind of person who becomes an officer. I wouldn’t want anybody to think that the phrase “for the purpose of carrying out ... the provisions of this act...” in some way or other is a qualification of the word constable as it appears in its bald form in the statute.

There are very serious problems of interpretation which we are compounding in this bill. They have existed for so long in the Highway Traffic Act, which is under the jurisdiction of the Minister of Transportation and Communications, and they have existed for a long period of time now with respect to evidence of insurance under the Motor Vehicle Accident Claims Act, and they are now going to appear in the same confused state as an additional provision in the Act to provide for Compulsory Automobile Insurance.

In appendix F the report said, and it poses the difficulty of the problem, “If it is important that a police officer” -- and I emphasize the if -- “be provided with the legal authority to carry out both these steps....” The two steps are, “to order a driver to stop, solely because he wishes to interrogate him as to whether the appropriate insurance coverage is in force; and to interrogate the driver after he has stopped and to require him to answer.”

I go on: “If it is important that a police officer be provided with the legal authority to carry out both of these steps, it is also important that his authority be expressed in terms that are clear and unambiguous.” I think what I’ve been trying to say is that the provisions of the Highway Traffic Act, the provisions of the Motor Vehicle Accident Claims Act and the provisions of this act are not clear and they are not unambiguous.

“It has been suggested” -- and I quote again -- “that when a Legislature intends to grant the police the power to limit the citizen’s freedom of action, that intention should be expressed in clear and unambiguous terms and should not be left to be inferred from the related terms of a statute. If this condition is applied to the Motor Vehicle Accident Claims Act” -- and I would read into that the Highway Traffic Act and this act -- “it becomes apparent that section 3 does not expressly grant police officers the authority to order a driver to stop for the sole purpose of conducting an insurance interrogation; it only requires that the requisite evidence be produced after the request is made. It is arguable that the intention of the Legislature had been to authorize the officer to order the driver to stop, but it may also be arguable that the intention of the Legislature was to authorize the request to be made only where the driver is already stopped and available.” In other words, when he is already stopped for some other reason unrelated to the sole purpose of insurance interrogation or whatever the appropriate analogy would be under the Highway Traffic Act.

I’ve spoken at some length on that particular section because I am still very worried about it, and I am very worried that we are now going to add a fourth provision in the statutes of this province which will be equally unclear and equally ambiguous. I think it is important that we try to clarify it during the committee hearings on this bill.

With those -- which to me are somewhat serious -- reservations, we in this party have little alternative but to endorse this step forward in the stages which this province apparently wants made before it can reach the rational, logical and reasonable goal of a government-operated automobile insurance scheme.

Mr. Samis: Mr. Speaker, I’d like to address a few brief remarks to this bill, not having had the benefit of the expertise of the select committee, however. I think it’s a bill that affects virtually everybody in Ontario and I welcome its introduction. I congratulate the minister for his initiative. It certainly is something that is long overdue in this province, attested to by the fact that Ontario is the last province in the country to introduce this legislation.

In some ways I find it a bit ironic. I recall vividly his predecessor twice removed -- the member for Carleton (Mr. Handleman) -- and some of the questions about compulsory insurance that were raised when he was the minister. I think the member for Kitchener (Mr. Breithaupt) raised some, I know and the member from Hamilton had raised some; plus some speeches the former minister had made on the subject and statements he had made to the press saying he was adamantly opposed to it, compulsory insurance wasn’t the answer; it wouldn’t work in Ontario, it hadn’t worked in other provinces.

I am really glad to see the government make this change, a very substantial change, in the whole field of auto insurance in general. I credit this minister for having made the change. It is something, I think most citizens in Ontario would agree, that was obviously needed because the present system, frankly, wasn’t working. It didn’t provide real universality of coverage. I would be the first to admit that no system achieves complete and total universality of coverage in the true sense of the word; but obviously the present involuntary system has failed to achieve what I think most citizens and most of the car-driving public in Ontario would consider adequate coverage.

Just as we in this Legislature have had to legislate compulsory seatbelts to solve a problem, and compulsory helmets for motorcycle drivers, compulsory safety standards, emission standards and automobile design standards, compulsory safety inspection on cars, so we have moved to the stage, belatedly, that we have to protect the motoring public and in the name of the public good introduce compulsory insurance in Ontario.

I don’t intend to get deeply involved in the philosophic dispute about the merits of public versus private insurance. I think some of my colleagues have covered the case for public insurance more than adequately. I recognize there are two philosophic positions on this and I recognize that each has some inherent validity; but I think regardless of our difference of opinion on the merits of each, the record clearly indicates that when our party did introduce public auto insurance in those cases where we were defeated at the polls, the party that campaigned against us and used it as one of the main issues in their election platform did not eliminate, did not abolish, did not do away with, did not substantially change the principle of public auto insurance. I refer to the Thatcher government in Saskatchewan, which was certainly as right wing as you could get; the Social Credit government of British Columbia, the son of “wackey,” which is as right wing as I suppose you can get west of the Rockies.

Mr. Martel: Genghis Khan.

Mr. Samis: You can say that if you want.

I refer to the most rabid right wing of all the Tory Premiers, Sterling Lyon in Manitoba, who campaigned very vigorously against this aspect of the NDP record. He’s been in power I think two and a half years and has yet to abolish it. He has yet to undermine the program, much as he said he would when he was campaigning. I notice right next door to us on the east, the province of Quebec has introduced a modified version of public auto insurance. It was a compromise. The lawyers won their compromise. I think it was introduced by a Liberal government initially and then actually legislated by the present government. I am sure that regardless of the results of the next election in Quebec, whether it’s the Liberal government or P.Q. government, the public aspect of their plan will continue.

There are some people in our party who believe in the public approach purely on the inherent philosophical merits, but I would like to suggest there are other people in our party and in society who see it in terms of dollars and cents. They see it in terms of what is actually best for the consumer rather than seeing it as inherently better in the public sector or the private sector. I don’t intend to regurgitate all those arguments or the philosophical basis for that.

One of the interesting results in the Quebec experience, when they introduced compulsory auto insurance, was that it had a very positive effect on the number of -- I guess you would call them wrecks and hazardous vehicles on the road. I don’t have the actual figures, but I recall reading there was more than a minimal decline in the number of car registrations in Quebec when they introduced compulsory auto insurance. I believe it’s tied in; you can’t get your plates unless you have adequate proof of insurance at the time, and you must buy the public portion of the auto insurance from their outlets, I think in the main the credit unions in Quebec. There were certain people who had old jalopies, purely fringe cars or borderline unsafe, and sometimes dangerous cars, probably worth anywhere from $50 to $200, who just decided, “If the government is serious, if we are going to have this, if this is the law, if I am really going to get hit if I go out and drive this jalopy; damn it all, I might as well forget about it, clunk it and sell it to the junk yard.” These people would either get off the road completely or have to go out and buy something that is actually safe.

[8:45]

We do have people like that in Ontario, who haven’t made use of the present program and who will probably try to defy or find a way around the compulsory program. Hopefully these people would be intimidated by the fact that this law is going to be in force and that this is going to be the way from now on in Ontario. If they have a car worth only 100 bucks, I would hope they would decide, rather than take a chance and rather than risk the penalties to get rid of it and either stop driving altogether or buy a worthwhile car.

Speaking very briefly to the matter of penalties, I am strongly in favour of stiff fines and very meaningful penalties for any individual violators of the proposed law. I think we have to stop fooling around and let the fringe element know we mean business on this one, because we are talking in terms of safety, human lives and the high cost of insurance.

I notice in the bill there are minimum fines for individual violators who don’t take out the insurance program we are offering, but when it comes to the insurers or the corporations there is no minimum fine, the maximum is just outlined in the bill. I realize there are certain legalistic arguments for that approach, but it does strike me as a little bit inconsistent that the individual has a minimum set for his violations but the insurers don’t have a minimum set for their violations.

Finally, I would like to wind up on something that is purely a personal opinion, probably an idiosyncrasy or eccentricity or hang-up -- call it what you want. Since we are bringing in this major reform in auto insurance and since we are bringing in the element of compulsion, I think this is the ideal time to ask ourselves at what age should people be driving legally in Ontario.

I really have a hard time trying to fathom in an industrial-urban society why we tell people, “You can’t have a glass of beer until you’re 19. The age of majority is 18. You can’t do a whole host of other things unless you reach the age of 18, but you can go out and get a car and drive it at the age of 16.” I can understand that in a rural society and I can understand that in small-town Ontario back 10, 20, 30, 40 or 50 years ago; but in today’s society, when one considers the types of cars we do have and when one considers the standards we impose on young people in other domains, it strikes me as somewhat inconsistent and illogical to say people can do all these other things only when they reach the age of 18 but this privilege, and that is what it is, is available to them at the age of 16.

I realize this is somewhat of a tangent. I do want to end by saying I welcome the introduction of the bill and I congratulate the minister.

Mr. Roy: I would like to say a few things about this insurance plan, if I might just reach over and look at the great volume of the select committee on company law. I am interested in speaking especially about the recommendations in the 1978 volume.

I would like to say, before I get talking about the bill, that walking into the building this evening by the north door, the Wellesley Street entrance, I saw a sign there saying “Medicare Bash.” I am wondering what that is about. Mr. Speaker, I am sure that you, as one of the gatekeepers of this institution, would want to know what is going on in the building.

I haven’t tried tried to follow it, but I look to my friends to the left and ask them what the celebration is about. Has there been a change in medicare?

Mr. Acting Speaker: That is hardly speaking to the principle of this bill.

Mr. Roy: I just want to put that on the record. What is happening with the bash? Are we all invited to it?

Mr. Acting Speaker: I would ask the honourable member to return to the subject matter of the bill.

Mr. Roy: Another thing I would do is pay tribute to my colleagues who have striven so diligently and unselfishly over all these years involved in the select committee on company law. Some of my colleagues have been on that committee for quite some time.

Interjections.

Mr. Roy: I hear some of the nasties coming out over there and I just want to say, speaking to all my colleagues on all sides -- the member for Riverdale (Mr. Renwick) has been on this committee for some time, the member for Sudbury (Mr. Germa) has been on it for some time, the members on the other side, my former colleague for Wilson Heights and now, of course, my colleague the member for Kitchener (Mr. Breithaupt) -- that they were intent on doing a complete and thorough appraisal of the insurance industry. There was no jurisdiction that was too far and there was no jurisdiction whose weather was too inclement. In other words, there was no sacrifice that was too much for these people to accomplish the task at hand. In other words --

Mr. Acting Speaker: There is no section in this bill dealing with travel abroad.

Mr. Roy: In other words, Mr. Speaker, these people were intent on having a full and complete report and no impediment.

Hon. Mr. Davis: Is he embarrassing you?

Mr. Roy: The Premier is here. My God, the Premier’s here and I don’t intend to embarrass him.

I was watching that football game Saturday and I thought I was watching the Toronto Argonauts. Ottawa was playing so badly I was thinking of the Premier. If he had bet he would have finally made a dollar.

Mr. Speaker, I want to pay a tribute to my colleagues on the committee because in my opinion, as one who’s had some work in the insurance field -- always for the plaintiff, of course, I want to put that on the record -- I want to say it’s always seemed to me to be somewhat of a strange situation that we allowed people to sort of opt out of compulsory insurance.

Mr. Acting Speaker: Now you’re speaking principle of the bill.

Mr. Roy: Yes, I’m back to the principle of the bill.

Mr. Acting Speaker: You’re not back, this is the first time you’ve touched it.

Mr. Roy: I want to say that I’ve always felt, as a general principle, if one is allowed the privilege of driving a motor vehicle there is a corresponding principle which follows -- to be responsible, not only for oneself but for third parties who may suffer as a result of his or her actions. So over all these years I’ve always been in favour of compulsory third-party liability insurance for every motorist in this province.

In so doing I want again to pay tribute to my colleagues who worked to finally get this minister -- and I pay tribute to the present minister, even though I want to say to the Premier I don’t know what he’s been calling the minister lately but things are changing over there. The shirt collars aren’t as crooked as they were. They’re getting straight now. And occasionally if I throw “Frank,” he says, “No way; it’s ‘Mr. Minister’ now.” So I tell the members we’re minding our manners on this side now when we’re speaking to the Minister of Consumer and Commercial Relations.

Mr. Acting Speaker: I wish you’d mind the rules of the House and not so much the manners and get on to the principle of the bill.

Mr. Roy: Yes, Mr. Speaker, I want to say that I fully support the bill. I think it’s high time we brought forth this compulsory third-party liability insurance. I really think that finally in Ontario the message will go out.

Having read the bill it’s obvious that a lot of people have had a lot of input, including my colleagues on this committee.

Hon. Mr. Davis: Give them credit -- give them credit again.

Mr. Roy: I will, because I want to say that when in the dead of winter you get up in the early morning to pick up that Globe and Mail, and you look at that picture, I tell you it’s very unfair. The same reporter who chased them down at that time is not around now to be looking at that hefty report. She’s not writing anything about that now.

Mr. Van Horne: She’s still hiding behind the palm tree.

Mr. Roy: Yes. She’s not around this House looking at this bill, looking at what has been accomplished. No way. There is not a reporter around; nobody around; nobody gets credit. I tell you I’m going to give these boys some credit. I think they fully deserve it.

Mr. Worton: This was conceived 16 years ago.

Hon. Mr. Davis: Albert, you want a mint.

Mr. Roy: Don’t slow me down, I’m just starting to get warmed up. You want to get on with this. You don’t want me to get involved in that principle of public insurance versus private insurance and all this stuff.

Hon. Mr. Davis: I want you to give them credit.

Mr. Roy: No, I will not. All I will say, though, is that from talking to my colleagues to the left I’m convinced there is some merit in the public plan. Obviously, there must be some merit or they would not function as well in the other provinces and in the other jurisdictions, and our colleagues who have been elected in other jurisdictions, whether it’s Sterling Lyon in Manitoba or Ross Thatcher in Saskatchewan, and others, would not have changed the system.

But that’s not the argument for what is best for Ontario, because my colleagues to my left must appreciate there has been progress in the private plan as well, and by and large, when I compare what is existing now in Ontario under the private plan, for instance, the way small claims are processed --

Hon. Mr. Davis: That is true of everything in Ontario.

Mr. Roy: Yes -- involving damages only, involving claims involving the loss of salary, and the smaller claims, the way they are processed, the service is relatively good.

The other thing is, as a lawyer, and one who believes in the rule of law, I have difficulties.

Hon. Mr. Davis: And as one who still practises in the courts.

Mr. Roy: Don’t you dare mention conflict of interest.

Mr. Breithaupt: That’s not our problem at all.

Mr. Roy: Yes. I would like to put on the record again that I act for plaintiffs.

I want to say I believe there should be some relationship between fault, that fault is still a factor, that it derives responsibility to people who are driving a motor vehicle. I believe as well in the principle called tort, that if one suffers damages, the courts as the final arbiter are still the best forum for determining the loss suffered by the victim, by the individual.

I get concerned. I get concerned, for instance, with the Quebec plan where you have a ceiling on how much one is going to get a month or how much one is going to get for the loss of a limb or the loss of earning capacity and so on. I tell you when you are at the bottom end of the scale, I suppose for the majority of the claims that’s fine, but there are nevertheless substantial numbers of claims where people will not be compensated for their loss.

That’s where the private plan, that’s where the rule of law, that’s where the courts and that’s where the legal profession come in. To take an approach and say it’s a public plan over the private plan is too simplistic.

I would say, and I say with all candour to my colleagues to the left, I have run into insurance agents, insurance companies and lawyers to whom I have said, “Acting the way you are would convince me easily enough that a public plan is best for Ontario.” There are people within the system who act as though each victim is a crook, and every person who is collecting, who is attempting to bring forward a claim is going to rip off the insurance company. I don’t like that attitude.

[9:00]

We’ve made amendments to the Judicature Act. I can think of the amendment involving interest, the system involving a large claim from insurance companies who would hold back until the courtroom door and then pay up because they were making money on the basis that they weren’t paying any interest or that the interest awarded by the court did not reflect prime rates. All of that has changed.

We’re refining the private plan. Things are improving. There’s no reason, because we’ve accepted the principle of compulsory insurance, that automatically you step into the other area and say, “Look at the 183 or so companies and the 36,000 agents: it’s a farce; there’s no competition,” and so on.

I’m not prepared to accept that, Mr. Speaker. I say that not because I hold a brief for the insurance companies or the insurance agents. In fact, I look at them over there. I take it that’s what all these fine people are, because the minister keeps looking that way. I notice that more than on other evenings there are more important Tories walking into the House and smiling in that direction. I don’t know if that has anything to do with the people who are here.

I do want to say to the dear people, the ladies and gentlemen under the gallery --

Mr. Acting Speaker: Please direct your remarks to the chair.

Mr. Roy: I have run now in three elections -- 1971, 1975, 1977 -- and I know there are two free-enterprise parties in Ontario. They should know that, keep that in mind. I want to tell them that in many areas they do know it; but in some, they don’t. I’m not going to single out any area, such as Ottawa-Carleton. I’m not going to do that. I wouldn’t do that. I do want to say to these fine people -- what’s that gallery called? Is that the Speaker’s gallery?

Mr. Acting Speaker: Under the Speaker’s gallery.

Mr. Roy: I do want to say to keep in mind that there is a group of individuals -- in fact, the alternative here in Ontario, right here on this side, led by the member for Hamilton West (Mr. S. Smith) -- who believe in free enterprise. They’d best keep it in mind.

Hon. Mr. Davis: From time to time he believes in free enterprise.

Mr. Roy: No, no; all the time, all the time; and the Premier knows it. If the Premier were to compare his own record with our leader’s record in 1971, the Premier would look like the Socialist. He would. He has reversed himself a number of times.

Remember the Speculation Tax Act? The Premier backed off that. Then he tells the teachers, “You can strike. We have a bill where you can strike.” They’ve got their bill there; it’s worked for five years. Now they’ve got a committee studying it.

Interjections.

Mr. Acting Speaker: Will the member for London North (Mr. Van Horne) either be quiet or return to his own seat?

Mr. Roy: He’s being verbally abused by the Premier. He is. I want to say to the Premier it’s going to be interesting shortly, once things don’t go that well and Joe is still in Ottawa -- the Premier will be there for a few more months -- who is the Premier going to blame now that Pierre Trudeau is not around any more? That’s going to be interesting. Who is he going to blame?

Hon. Mr, Davis: You.

Mr. Roy: Me, yes. That’s what I thought. It’s going to be the fault of the opposition.

I don’t want to take up too much time. I notice my dear friend the minister obviously wants to wind this up in front of the assembled gallery. I want to say we are in support of the legislation and I will conclude by asking the minister a question just to prove that I read the bill, something the Premier hasn’t done and that’s for the record.

What safeguard does he have in his legislation to prevent an individual purchasing insurance, getting his plates and then cancelling for a variety of reasons? Is there some mechanism where, when he cancels the insurance, he must advise the ministry or something along that line? I see that as one of the evils within the system. Even though one has to take premiums based on a yearly basis, an individual can cancel that insurance and continue driving. When people are intent on driving without insurance, they’re going to find all sorts of ways to do it.

Hon. Mr. Drea: It’s impractical to do it until he can find a new owner.

Mr. Roy: I guess he’ll have to. I’d like an explanation why there isn’t some way for the insurance companies to report to the ministry when this cancellation takes place.

You’ve been indulgent and very patient with me, Mr. Speaker. I’ll not hold you up any longer. I’ll let the minister go at it.

Mr. Warner: Before making some comments on the bill itself, I would like to pass along my personal thanks both to the staff that served the superintendent of insurance and to the consultants, Mr. Paul Boddy and Miss Ludmilla Jagiellicz. The consultants, in my opinion, provided much-needed expertise and did so in a very objective and complete way.

I wasn’t on the committee for very long, just a few months. One of the reasons I enjoyed the work on the committee was the fact that we had experts. The consultants provided us with the material we needed to try to deal with the matters in an intelligent fashion. There is no question in my mind that the report done by that committee is extremely thorough. The document is well worth studying by members of the assembly, and well worth the government’s taking a serious look at. I would also mention that the chairmanship of that committee was extremely good. I felt the chairman did a first-rate job in attempting to expedite the matters of our committee while allowing each member to participate fully.

I will say, going into the committee knowing it had sat for many years and was likely to sit for many more dealing with various aspects of insurance, but noting that this particular portion was going to deal with automobile insurance, I had anticipated a rather bitter battle over government car insurance. It ran through my mind that that was what I would encounter on the committee.

I was pleasantly surprised. The members of the Liberal Party and of the Conservative Party who were on that committee had taken the trip out west, they had looked at all the material provided, and what they were left with wasn’t a factual argument any longer but an ideological stance. I find that much easier.

If someone else wishes to have a difference of opinion based on philosophy, that is fine. When they have gone over the facts and they realize the facts are there and they are indisputable, then I feel good that the case has been argued and it has been won.

Finally, through the thoroughness of the report, we have put the argument to rest about how evil a government car insurance plan is. That argument is finished, because the evidence is in and it is very clear and unmistakable.

The Conservative and Liberal members of the committee obviously had difficulty in coming to an overwhelming support of a government-run scheme -- I understand that -- there were many, many positive comments about a government-run car insurance scheme, one of them being that “the level of apparent efficiency of the government insurance corporation is higher than that of the Ontario insurance companies. The committee has taken great care in reviewing the basis for this comparison. It has concluded that, while the financial information provided to it may not be exact in every detail, it is substantially correct and the comparisons which have been made are fair in substance. The committee cannot quantify this higher efficiency.

“Having reached the conclusion, the committee considers that the apparent relative inefficiency of the industry in Ontario is of serious concern. The committee believes that improvements can be achieved in the operating cost structure of this industry, certain of which may find their origin in the operating methods of the government insurance system.”

In other words, if the insurance people in this province would study the government-run scheme, they might learn something and make a more efficient operation in the province. That wasn’t the view of only our members; that was the view of the committee in total, and I certainly appreciated it. What it said to me was that, while the members on an ideological basis could not come to support a government-run scheme, they did recognize from an objective standpoint the merits of a government-run plan.

Of course, as has been pointed out by other speakers, when New Democrat governments were moved out of office for a short while in Manitoba and British Columbia, the successors in both cases not only maintained the programs, but also spoke highly of them and praised them. In particular, the government minister in British Columbia who was responsible for the plan was quoted as having said it was a marvellous plan and he couldn’t envisage returning to the private scheme; that quote was given again to the committee members.

I was interested in the comments by my colleague from Ottawa East when he touched on the fundamental rights of lawyers -- I think that is the correct term he was talking about, because he likes to represent the people who are grieved in these situations. It seems to me that is, boiled down, the inalienable right of lawyers to sue. That is what it is all about.

The committee, in addressing itself to no-fault insurance, came to a very interesting and positive conclusion; again, this is an aspect which this government should follow through on.

“In formulating its conclusions, the committee began by addressing the basic issue: whether fault should continue to be the fundamental factor to be considered in determining whether compensation should be paid for motor accident losses. The committee is particularly impressed with the capacity of no-fault systems to compensate all victims, regardless of fault, rather than paying only the relatively innocent. It is also impressed with the capacity of no-fault systems to reduce adjusting and settlement costs by minimizing fault investigation, so that a significantly larger portion of the premium dollar will be returned to the public in claims payments.

[9:15]

“The committee accordingly recommends that ‘fault’ should no longer be the fundamental factor to be considered in determining whether compensation should be paid for motor accident losses. Further, the committee also recognizes that the recommendation that it has formulated served only as an outline for a new no-fault automobile insurance program for Ontario.

“It also recognizes there has not as yet been an opportunity to make any projections as to the cost of the proposed new system, although it is apparent that the savings to be gained from increased efficiency and the reduction in noneconomic compensation claims will in all likelihood offset any overall increases in other claims costs. Exact dollar projections must inevitably be left to the industry and the superintendent and a fine-tuning of the terms can be conducted on the basis of that information.”

So it is clear from the comments that the committee feels the no-fault plan is worthy of very serious consideration and would like to see it implemented. In fairness there were some members of the committee who dissented from that opinion, but the majority view was in favour of the no-fault system.

Reflecting on a portion of the principle of the bill which deals with the superintendent being able to look at the rates for the Facility, it seems to me that principle could be followed through. Again the report, dealing on a section of the government presence in rate regulation, mentions: “A broader form of rate regulation is embodied in sections 365 to 367 of the Insurance Act of Ontario. These sections empower the superintendent to order after due notice in a hearing an adjustment of auto insurance rates whenever they are found to be excessive, inadequate or unfairly discriminatory or otherwise unreasonable. However, the sections have never been proclaimed in force.”

My memory is a little faulty on occasion. I can’t recall whether it was 1932 or 1933 when that section was passed, but it was one of those years.

Hon. Miss Stephenson: 1934.

Mr. Warner: Sorry, I was wrong, 1934 -- I was out by a year.

So that was first put in in 1934, but never proclaimed. Now for the first time we come back and we are giving a small measure. We are going to put it with respect to the Facility -- that makes sense. I would like to see that extended as a principle for all insurance in Ontario.

It is not just myself, but the committee’s opinion is that “more emphasis is required in Ontario on rate regulation in order to achieve a better balance between financial stability and the other objectives of rate regulation.” There is obviously a need for it.

Most members will conclude if they go through that report very carefully and look at the principles involved in each of the parts that are dealt with -- whether it is no-fault insurance, rate regulation or any other section -- there is a compelling message in that.

Some day in Ontario -- as my colleague from Riverdale says so accurately, whether it is the Conservatives or us -- there will be a government-run scheme. Why does this government not take the credit for it now? The people out there will stand to save a lot of money. We had estimates in the committee ranging anywhere up to $45 million a year in savings for this province. They stand to gain and would thank this government. There is a challenge for them.

I put it to them as a challenge because the day we take office, it will be one of our first items of business -- a way to protect the drivers of this province from exorbitant rates and to have a measure of equity and fairness about no-fault insurance. That is the kind of protection that is needed in this province. We have waited many years.

The challenge is there to the minister. He has met other challenges before, many of them quite successfully. Here is one more. It one for which the hundreds of thousands of drivers in this province would thank him because they could save money. They would know they weren’t being ripped off and they would have the kind of overall coverage and protection that is needed.

In conclusion, of course I am pleased to see the introduction of this bill. It is long overdue. I must also remind the House that this bill is only one small part of that select committee’s report; there are many more important aspects of that report which must be dealt with, and the sooner the better. Let’s not wait for the change of government, although I’d be quite happy to make the changes needed.

Mr. Worton: Mr. Speaker, I would like to add a few words of compliments to the select committee that has brought forth this recommendation.

I want to say it has been 16 years since the previous report was brought forth. The father of the member for Hamilton Centre (Mr. M. N. Davison) sat on a select committee with me at that time and it’s true, that committee recommended compulsory insurance. If I recall correctly, while his father supported compulsory insurance, he did support a public owned insurance program. Of course, in the period of time that we studied that, we crossed Canada and visited the states of California, Massachusetts, New York and, I believe, North Carolina. Now it has been 16 years. If I can get my medical expression correct for the Minister of Education, I believe it is the longest gestation period that has ever taken place to bring forth a bill and have it passed in this House; 16 years to get something done. Anyway, it is a move in the right direction.

I didn’t hear the reply that was made to my friend the member for Ottawa East in regard to his concerns about paying for the insurance and then cancelling it. That was the very problem they were running into in Massachusetts and New York when they had it at that time. By the time they caught up with them, very often a great deal of damage had taken place and a great deal of misery had come about. Maybe the minister can clarify that when he is giving a further explanation of his bill.

Mr. Isaacs: Mr. Speaker, I rise briefly to welcome this bill. I feel it is a great step forward in that this debate is one of the major debates in the history of Ontario. As you know, Mr. Speaker, I have only been in this country for just over 10 years. When I came to Ontario I was horrified to find that motorists’ insurance was on a voluntary basis, and that there were many drivers on our roads who were not covered by insurance and an unfortunately large number who were not covered by the uninsured motorists’ fund either.

I note that some of the members opposite have been looking at their watches, I suppose trying to convey the concept that they would like to see this matter dealt with very speedily. I understand that and that’s why I will keep my comments short, but I really feel that in this Legislature it’s very important that debates of this kind, which will go down in history as marking an important day in Ontario, be given full and adequate consideration.

I have been a driver for over 15 years and I have always been one who has carried insurance, but during that period of time I found many flaws with that insurance. Since my time as a local alderman and as a member of this Legislature, I have had even more people come to me and tell me about the problems they have faced with automobile insurance.

One of those problems has been the matter of discrimination or supposed discrimination. I commend the minister for attacking that problem head-on. I want to suggest to him there are many problems as yet unsolved and that insurance companies at the present time are dealing with people in classes. They are treating everybody within the class as if their driving skills and their driving abilities were equal, be they young people or senior citizens or individuals who have encountered an accident situation in one way or another which was perhaps not their fault but perhaps as a result of another driver. Those people are being put in a pigeon-hole and treated by the insurance companies as a class and, in general, charged a higher rate as a result.

I want to suggest to the minister that is a kind of discrimination and is unfair. We have to find a way whereby automobile insurance is matched to the individual and to the individual’s ability to drive. I want to suggest that the public automobile policies suggested by some of my colleagues are perhaps a way of addressing that issue because the private companies that are at present responsible for selling insurance have shown their inability to come to grips with that issue. In fact, when the minister made some of his statements earlier this year, urging the companies to do away with the kind of discrimination they practise, they responded to him in a very negative sense. They did not appreciate his intervention. I did. I felt it was a tiny step forward. I would urge the minister to find stronger and stronger ways of dealing with this kind of problem.

Another difficulty we have with insurance companies at the moment is the matter of standardization of benefits. Standardization of coverage has in some way been dealt with by the standard automobile policy that most drivers have and there is room for individual preference within that automobile policy, but the standardization of benefits has not been achieved. Despite some of the advertising put out by the larger automobile insurance companies, we are left with a situation where the driver is buying the unknown. When one goes and buys automobile insurance, he really doesn’t know how he will be treated by that insurance company if the day comes when he needs to make a claim. I want to suggest that much could be solved by standardizing the coverage.

My colleague from Ottawa East spoke earlier about the involvement of lawyers in this whole process. It seems to me sometimes, and I know it seems to many of the people who are involved in automobile insurance claims, that some of the procedures are put in place deliberately to provide fodder for the lawyers who are involved in the process. I want to suggest much could be saved if we had standardization of coverage and a single system for resolving automobile insurance claims in this province. I would urge upon the minister that he give consideration to that kind of approach.

A problem we also have with our present standard automobile insurance policy that I want to draw to the minister’s attention is that an individual in different circumstances can be treated in different ways. One that concerns me greatly is a clause in our present Ontario standard automobile insurance policy that excludes from the benefits of that policy people who are covered by workmen’s compensation at the time the accident occurs. That bothers me very greatly because it means that if a person in the course of his job is involved in an automobile accident on our highways, he cannot claim in the same way as an individual who is driving for pleasure or who is otherwise not covered by workmen’s compensation. That’s just an example of some of the problems we have with automobile insurance.

I believe too we have to come to grips with the matter of limit of liability. Our colleagues to the south in the United States are facing a situation where claims under insurance policies, particularly automobile insurance, but I will generalize as well, are increasing year by year and claim by claim. It seems at the moment the sky is the limit. I want to suggest that is not to the benefit of the people of Ontario. The minister has it within his powers to look at this situation and to come to grips with the matter of a limit to insurance liability so that all of us in Ontario can gain benefit therefrom, rather than having to pay for the astronomical claims being generated by the legal system and the court system.

[9:30]

Mr. Roy: It is not happening here.

Mr. Isaacs: My colleague says it is not happening here and I agree, but it will come unless the government takes action to stop it coming. I suggest we should act before the situation becomes desperate.

I want also to ask the minister about one provision in the bill that relates to some other comments that have been made previously. In section 15(b) the Lieutenant Governor is empowered to make regulations “prescribing identifying markers for all automobiles licensed in Ontario.” I would hope that has something to do with some of the matters that have been discussed in association with plate-to-owner rather than plate-to-automobile. In the explanatory notes it suggests it is self-explanatory, and I really don’t find it self-explanatory the way it stands.

I hope the minister will give us some assurances about the meaning of that clause and the way it is going to be used in the future because it has the potential to be a very significant clause, but it has no meaning without a better explanation than is provided in the bill.

I want also to suggest to the minister that one major problem remains unsolved, and it may be unsolvable, although I would hope that there are ways of dealing with some of the difficulties. That problem is the people who are suffering now and who have suffered since this bill was introduced as a result of motorists who have been uninsured and who have not paid into the fund that was set up for such motorists.

It has been a very sad situation that those people have gone essentially without any kind of benefit, even when they have been involved in an accident that was 100 per cent the fault of the other driver or of some other individual. It would seem to me that should have been dealt with a long time ago and if there is a way of dealing with it now, then I hope the minister will address it.

Just very briefly, I want to comment on the matter of a single automobile insurance system for Ontario. I know the members opposite consider themselves committed to a free-enterprise system, but now that we are moving into compulsory automobile insurance I want to suggest that automobile insurance for many people in Ontario is taking on the form of a utility that serves the people. Ontario Hydro is a very major utility that is a crown corporation and that serves the people reasonably well. We can have our disagreements with certain aspects of its operation but in general Ontario Hydro is set up to serve and does serve the people.

That sort of model could be used for automobile insurance, but even if the government doesn’t wish to go that far, I want to suggest there could be much more regulation of the private automobile insurance industry than there is at the present time. It could be done in ways similar to the ways in which the telephone industry and the cable television industry and other utilities are regulated. We should move towards regulation of essential services that are in the form of utilities and any indication from the minister that greater regulation will be put on the system will be welcome on this side of the House.

Those are my brief comments. As I indicated before, I welcome the introduction of this bill. It is so long overdue that it is sad, but change has to come and I welcome this change, as I will welcome a change at the time of the next election that will lead us to put in place some of the things members from this party have spoken about.

Hon. Mr. Drea: Mr. Speaker, I am going to be brief. I would like to divide this into two sections. The member for Ottawa East and the member for Wentworth asked some particular questions.

To the member for Wentworth: On the particular section he queried it is true that in the case of a change to a plate-to-owner system that section would be necessary. It’s just a provision that gives us the authority to cope with whatever changes come when the plate-to-owner system is introduced.

Mind you, the plate-to-owner system isn’t just a simple conversion of the record. It also will have something to do with the style and type of plate and when one gets it, type of operation. That’s why that is vague and in there; it does give us the authority so at the particular time when plate-to-owner comes the compulsory insurance regulatory provisions will be in step with it.

To the member for Ottawa East: There’s no question that some people may have 30-day or short-term insurance coverage purely for the purposes of obtaining licence plates -- in the past they did it to avoid paying the penalty fee; now, presumably, they will do it just to get the plates because one will not be able to get a plate without signing one’s name on the back of the form where there is also the insurance company name and insurance number. This is a difficult problem, but there is no question that when plate-to-owner and computerization come it will be a relatively simple matter to control, because licence plates simply will not be issued if the insurance number does not punch out on the computer, much the same as the cash register doesn’t open now when one’s credit card is overdrawn or in default. Until then, I say to the honourable member, it’s not the expense or the time-consuming nature of it that’s the problem, it’s the confusion that would be caused by a manual system.

For instance, a person might want to change agents or companies for a very valid reason. His insurance is perfectly paid up -- and insurance does not always come up for renewal at the time of the purchase of plates; it generally reflects the time of the year when one bought one’s first automobile and that carries through the rest of one’s life.

For good and sufficient and honest reason -- he just doesn’t like the service the company gave him -- the person might very well transfer over to some other company. The company he left might get its report in first, whereas the company he’d renewed with would do so a little bit later. There would be the difficulty of somebody having his licence suspended by mail when, indeed, his insurance was paid up. On a manual system, I just don’t think it’s practical.

I agree with the honourable member that this is going to be our main problem in the future. It will not be, as it is now, the person totally avoiding the system and not paying in. The big problem will be the person who at the time of sticker renewal is covered but then lets it lapse. This is my concern.

We say a quarter of a million people who haven’t yet broken their maiden in the insurance field are going to be brought into this. Nobody knows. Nobody knows, because on any given day after March 1 one gets into that diminishing return. Have they renewed or are they going to wait until next year?

Mr. Speaker, I want to commend the members of both the official opposition and the New Democratic Party for the very constructive remarks overall they have made about this bill.

Just for a few moments, I want to reinforce something about public insurance. I was read from the select committee report today some of the advantages of public insurance. I think it would also be fair to point out to the member for Hamilton Centre, the critic of this ministry, there was a much more lengthy section on disadvantages and the disadvantages went all the way from the impact on the employment structure to government corporations not paying corporation tax; ratings being too simplistic or inequitable; hidden subsidies; a government corporation --

Mr. M. N. Davison: Mr. Corporate Protection.

Hon. Mr. Drea: Please, please, please. The member read the advantages, I’m reading the disadvantages from the same report. To continue: “a government corporation may become a political vehicle and deviate from sound insurance practice; operational startup problems and cost; vulnerability of labour problems and pressure groups....” Does the member know today in Quebec it is only a stroke of Rene Levesque’s pen that has the regie operating. They were all ready to go on strike. Who would have paid all those benefits? Every one of those is a bodily injury claim, every one. It’s only that signature.

Mr. M. N. Davison: Don’t preach to me about operating in the public interest.

Hon. Mr. Drea: Obviously, obviously, obviously, I have struck some blood. I may stay on that for a while. To continue: “no freedom of choice or comparison for the consumer on basic coverage; no right when they go on strike even to get one’s car fixed.” Do the members remember the ICBC? BC was the junkyard of the world. People were told, “Drive your car because they’re on strike.”

Mr. M. N. Davison: So now you’re against trade unions, is that it?

Hon. Mr. Drea: No, but if we are going to bring in a monopoly situation, we are going to say to the employees of that company, “You have every right to go on strike and to devil with the public,” at an appropriate time. That is exactly what happened in British Columbia, and it lasted for three months. That’s why the member didn’t mention it from 1975 until tonight. It’s taken four years to get over what happened out there.

Mr. Roy: Don’t mention disadvantages, that’s not fair.

Hon. Mr. Drea: I just want to read one other section out of that report:

“It is apparent that while a government corporation may be a credible solution to some problems, it will create a number of new ones and may be incompatible with the free-enterprise philosophy accepted and practised by the business community and a large segment of the public in this province. Government ownership of automobile insurance in Ontario would pose a significant implementation task.”

Enough of the disadvantages. I want to come to this question of public insurance from another direction. I point out that the introduction of public insurance in this province, and some members of the New Democratic Party have allowed this little thought to escape from time to time, would have absolutely devastating consequences on the business and financial enterprises of this province.

First of all, more than 44 per cent of all the insurance underwritten in the Dominion of Canada is underwritten in Ontario. More than 50 per cent of the automobile coverage for the Dominion of Canada concerns Ontario drivers. If we demolish 183 competing companies and turn them into one, who is going to pick up the office space? Who is going to pick up all the other things that went with those companies, because most of them aren’t going to stay here. There won’t be enough volume for them to stay.

Nor, indeed, would there be the capital pool or the investment pool that comes from the very nature of that industry.

They collect premiums at the start of a year on a one-over-365 basis. They may not have to pay out that money for 11 months and in the meantime they invest it. It would all disappear. Instead, the member would have the government collect that pool. I suggest the reason Saskatchewan, BC and Manitoba haven’t changed is because the cash flow that comes in on one day or in one mouth is so nice they can’t afford to change. Those three provinces have slipped the cash flow from the private, competitive market so their government can operate on a deficit basis without it being so apparent and can generate funds without having to go to the market.

What a model the ICBC provides for some members. Have they seen what the ICBC has done lately? The flat-rating? Do the members believe in flat-rating right across the province, regardless of region? In fact they better not, because I can give them some rather devastating figures on the results of flat-rating, as they’re doing in British Columbia -- no matter where you live and no matter how much you drive you pay the same.

[9:45]

Mr. Charlton: That’s also what the Tories in BC are doing.

Hon. Mr. Drea: I see. Now the ICBC isn’t quite as holy as when the NDP was in power and ran it into a deficit. They couldn’t settle a strike so nobody got his car fixed.

There are roughly 12,000 agents and their support staff in this province, exclusive of the companies that underwrite them. To go into public insurance would be the most devastating attack upon established small business in this province that has ever been contemplated by anybody. It would wipe out those agents, the income and the tax they pay in their local community. It would wipe out their support staff. As a matter of fact, the worst evil of all, it would take away the ability of them to sell their agency. Since they have been self-employed, that is the money they have been counting on for their retirement. And it would be done with a stroke of the pen.

What would happen as an alternative? There would be 10,000 new civil servants in this province in one day. By the way, in the three provinces that have gone this route, the pay that goes to the civil servant -- ICBC, Autopac Saskatchewan government insurance -- is between 25 per cent and 35 per cent higher per person than when they worked in the private sector. In short, these members would be providing monopoly coverage called “take it or leave it” -- whatever rate they wanted to give.

Another of the cute little devices -- and the member raised this in comparing prices -- the driver’s insurance policy may be flat-rated but the penalty points come on his driver’s licence. One pays $3 a year in this province for a driver’s licence -- $9 for three years. How much does one pay for a driver’s licence in Manitoba, British Columbia, Saskatchewan? Are these members prepared to concede that a bad driver will pay over $200?

I want to talk about some other little things. What about the leased cars that would be charged for at business rates -- not the way they are now?

There would be an automatic staff reduction in agencies writing large volumes of automobile insurance by at least 50 per cent. That’s in addition to the agents losing their businesses -- indeed, the right to sell their businesses.

Incidentally, these figures are compiled by the new organization in which the member for Sudbury has so little faith. This is from the Registered Insurance Brokers of Ontario, the new self-regulatory body. As a matter of fact, they have stationery from the old Independent Insurance Agents and Brokers of Ontario, the IIABO.

When one considers the many millions of dollars in government subsidy, the many millions of dollars in lost opportunities and the destruction of the most viable small business in this province -- which goes right across this province, particularly in the smaller communities -- when one takes away the opportunity for people to have that business; when one takes away the need to build large buildings -- these people who are so interested in the construction business should be at least interested in preserving the office space requirements in the major urban areas -- and so on. I could go on for some time with this.

I want to end very simply. It has been suggested that I am responsible for taking the first step, depending upon which speaker for the New Democratic Party raised this -- sometimes it was a small one, sometimes it was a giant one -- towards publicly owned and operated automobile insurance. As a matter of fact, it was suggested that somehow I would nail it up on the masthead before I was gone. Mr. Speaker, I will tell you, as long as I am the minister there will not be public insurance in this province. As long as the most distinguished statesman in this country, the Premier of this province (Mr. Davis) is Premier, and this government is here, there will not be public insurance.

This bill is not a step towards anything. I will tell you, within two years I will be so disentangled -- and I make no bones about this, this is a straight thrust from my ministry -- within two years, I would hope, within one year, we will be so disentangled from the operations of the insurance industry by the self-regulation of the agents, and by certain other endeavours we are going to do with the companies, including the privatizing within 18 months of the motor vehicle accident claims fund and the records for the future, that no matter who gets in here, Mr. Speaker, there won’t even be the opportunity to bring in, with all of its devastating impact and all of its implications, public insurance.

With the passage of second reading of Bill 160 tonight, public insurance is dead and buried in the province of Ontario.

Motion agreed to.

Ordered for committee of the whole House.

SECURITIES AMENDMENT ACT

Hon. Mr. Drea moved second reading of Bill 156, An Act to amend the Securities Act, 1978.

Hon. Mr. Drea: Mr. Speaker, I have a few remarks on the second reading of this bill.

As I said before, the bill deals with a number of points, mostly of a fine-tuning nature to resolve minor questions in the interpretation of the Securities Act adopted in June 1978.

As members know, since that time the commission and staff have engaged in extensive discussion with members of the financial industry. Also, they have gained practical experience with the application of the new act since it was proclaimed on September 15, 1979.

All of the amendments, except the new section 62, have been exposed at length for public comment and have been revised to reflect comments received. I will not attempt to deal with them in detail except to say they will further improve an already good statute.

I understand the changes have been reviewed with the securities commissions in other provinces, and are expected to be included in the uniform legislation which most of the provinces now have under active consideration.

One change merits particular attention, the new section 62 to permit the short form and summary prospectuses. This section is the only one that has not been exposed generally for public comment but its objective is obviously desirable.

When this bill is adopted, the Ontario Securities Commission will publish for comments a draft regulation which, among other things, will permit a short form prospectus for junior mining issues.

As I am sure members know, many junior mining companies have expressed concern with the cost in delays now involved in filing a prospectus with the OSC. I expect a short form prospectus will go a long way to meet these concerns. The draft regulations will also provide for a summary prospectus to be used by mutual funds. I have asked the commission to report to me on its experience with junior mining and mutual fund prospectuses under these new regulations in order that we may consider making similar provisions as to prospectuses for other types of issue. If this experiment is successful it will do much to reduce the burden of the prospectus filing procedure while maintaining investor protection.

As I mentioned when I introduced this bill for first reading, the fine-tuning provisions that it contains include revisions of the takeover bid rules to reflect experience gained in the competitive takeover bids of last winter.

Since I introduced the bill a number of technical concerns have been raised as to one provision. Rather than revise it hastily, I propose to withdraw it in order to allow ample time for consultation prior to its reintroduction in the spring. Accordingly, I will be moving in committee that section 14(1) of the bill be deleted.

Also tonight -- and I am sure the member for Kitchener (Mr. Breithaupt) and the member for Riverdale (Mr. Renwick) will probably want to make some remarks -- we have here the very distinguished chairman of the Ontario Securities Commission, whose tenure in his position is drawing rapidly to a close. As the minister I would say on behalf of the public of Ontario, notwithstanding there was an agreement with Mr. Baillie as to what his tenure would be, the “rapidly” is approaching just a little bit too rapidly.

This will probably be his last appearance as an adviser to a minister, either in committee or before the House. His record of service as the chairman has been distinguished and outstanding. His record of accomplishment would really take a considerable time to document. He has served the public, the investors, the securities industry, and indeed the entire business community admirably and well.

As I mentioned, with the passage of Bill 156 there probably will not be another occasion for him to appear formally before the House or in committee as an adviser to the minister. I think it only appropriate that the Hansard report marking the start of the progress of this bill to the Legislature does reflect some comment, however inadequate, of the job Mr. Baillie has done as the chairman of the Ontario Securities Commission.

Mr. Breithaupt: In starting my remarks with respect to Bill 156, it would be appropriate for me also to add my point of view with respect to the involvement James Baillie has had in the securities commission during these last several years.

Perhaps it is because I have been here for just a few years now that I look upon someone like Jim Baillie as a young man; yet he is one who has made an exceptional mark, not only in the practice of the law but also in the opportunity he has given to those of us who have met with him from time to time with respect to his knowledge of securities legislation.

He clearly has brought to this task an expertise which is remarkable. Certainly the persons I have spoken to from time to time who are in the somewhat more active securities business, as brokers, as dealers or as persons on the floor of the Exchange or whatever, have consistently viewed his involvement as a very happy occasion.

I suggest what he has brought to us has been two particular points of view. First of all, he was involved in the provision of the securities legislation last year, Bills 7, 8 and 9 as I recall. We spent some time on detail in the committee in the spring of this year looking over in depth the involvement of what those bills might bring. He brought those bills before us as an administrator of that legislation, but more important he also had the opportunity of bringing these bills before us from the entirely balanced point of view of someone who was knowledgeable in the field of security, of someone who was mature in the approach he has taken for the responsibilities he has had and of someone who really has had a leadership obligation within securities legislation in Canada that is truly second to none.

It is clear, as the minister commented earlier, that the involvement of the chairman of the Ontario Securities Commission really sets a tone and an obligation across the country. Surely it is important for our legislation to have a common background, so that particularly in the common law provinces outside of the province of Quebec we have a consistent and thorough point of view that is clear, and we have an opportunity to make sure the law which we pass in Ontario is truly the common approach the rest of the provinces will take.

[10:00]

We have seen in the attitude and in the style and intelligence Mr. Baillie has brought to this task that his point of view from time to time on a variety of legislative commitments has been accepted by those in other provinces as that of one who clearly knows what he is talking about. He clearly has given leadership to which we can all refer.

Certainly in the year or so I have been the critic in this ministry, I must say, Mr. Speaker, my relationship with Mr. Baillie has been excellent. He has always been thorough and clear in the point of view he has brought with respect to the details of legislation that have come before us from time to time.

It is clear in reviewing the Ontario Securities Commission bulletin, or indeed looking at the interviews in the press, whether it is the Financial Post or the other newspapers, whether it is looking at the journal articles or the other things we have seen from time to time, Mr. Baillie is a person who has brought a substantial amount of expertise in a short and concentrated time to the job which he has.

I wish him well as he returns to a private practice; I am sure we will hear much more of him in years to come. It is my pleasure to second the remarks the minister has made in this opportunity we have to comment upon the service Jim Baillie has brought to the people of Ontario, to the government, the Legislature, and indeed the commercial community within the province with his own expertise, in this possible last circumstance we have to see him in action in this post as we deal with the amendments to his bill.

The minister has commented from time to time, not only in his initial statement but this evening, as to the provisions of this bill. We have seen here a compendium of the amendments which are necessary to this bill, amendments dictated by what experience over this past few months has shown should be developed because of changes in securities legislation and in the operation of the securities market.

Perhaps you will recall my earlier comments in the ministry’s estimates, as we looked at the opportunities for increased junior mining participation, and the opportunity as well to have new products available without some of the difficulties of the more senior securities, as has been the case in Ontario over these past several years.

I am sure the members from northern Ontario are well aware the development of new mining prospects, and of a variety of other opportunities, has been somewhat constrained over these last few years because of the rules as they now exist.

I recognize we have a responsibility to the investor to make sure a basic amount of information is available so that the bucket-shop operations, and all these tragic stories we hear from time to time, the con jobs and all this sort of thing, are not maintained with the presumed authority or imprimatur of the government of this province. Of course none of us wants that. There seems to be a middle ground, and that middle ground is something for which the somewhat circumscribed prospectuses for junior mining companies, and the involvement with respect to that kind of development, is available for investors in the province of Ontario.

In this amendment bill, Mr. Speaker, we have also dealt with the takeover bid situation to some extent. I understand from discussing it with the minister that some of the provisions which otherwise would have appeared in this bill are to be reconsidered, particularly the first portion of section 14, which is not going to be proceeded with at this time.

I think that is reasonable, in looking at the involvement from the mining and business community, if they are of a view, on a calm reflection, that this kind of an amendment is not going to be practical at this point.

The early amendments in the bill are things with which I certainly agree. I look particularly at section 11 which deals with interim financial statements. We also look, later on, at the various changes to the later sections of the bill that deal with a variety of amendments which are going to avoid interjurisdictional conflicts and which are going to give the opportunity to the Ontario Securities Commission to have extraterritorial meetings to ensure that consistent securities law does develop, not only throughout Canada but also with respect to the American jurisdictions in which our own investors are also involved.

A number of these matters are housekeeping matters which I think can be dealt with quite promptly if there is a need to deal with this bill in committee.

The whole matter of takeover bids, of course, has been of great concern to Mr. Baillie and his colleagues on the securities commission. We discussed this at the time the bill was dealt with last year in that earlier package of Bills 7, 8 and 9 to which I referred. This was also discussed at the time of estimates. I am quite aware the minister has been concerned about this flurry of takeover matters that just didn’t seem to work out as far as having consistent approaches to legislation was concerned and as far as minority shareholders and other individuals being clearly knowledgeable about what in fact was going on was concerned.

This is a new phenomenon, I suppose, within the Ontario securities world. We have found, in looking at the operations of a variety of companies, that they have chosen to use their funds to buy other companies. I suppose if one were in the aquarium business one would wind up reviewing the circumstances based on the fact that bigger fish eat smaller fish, but the end result, of course, Mr. Speaker, as you are well aware, is that you don’t wind up with any more fish. Possibly it could be that we are using funds only because there’s no better purpose to use them to buy other things. Indeed, it may well be a burden on our economy in these next few years that instead of creating more fish, all we will really be doing is creating bigger fish. Of course, only time will tell on that point.

Mr. Wildman: Sharks.

Mr. Breithaupt: They may be sharks from one point of view, I don’t know, but the end result is simply there. We are not necessarily creating more opportunities for investment or more detailed and interesting obligations, as a result of which the stock market could show or sell shares. We are simply developing a larger and larger, almost merry-go-round of investment opportunities which really do not create anything new.

The purpose of this legislation is clearly to encourage the continuance of a standard of securities legislation within the province. As we look at those earlier Bills 7, 8, and 9, to which I have referred, certainly it was the obligation, I think one that was cheerfully accepted but one that was also clearly on the mind of the securities commission as it brought these bills forward to the minister, that we in Ontario were setting a standard for securities legislation within the province. The provisions of the proposed Bill 132 have now been withdrawn and reworked so that we see the details of them in Bill 156.

The two concepts the minister referred to with respect to the short form of prospectus and with respect to the summary statement are both, I think, items that should be encouraged. We have had, as I have said earlier, the prospect of more junior mining obligations which I believe will be useful within Ontario, and yet we have the obligation to make sure those prospectuses and the information available to investors are on a sound basis. This, I hope, will be a happy combination of the needs for the future prospects of our security development with the consumer involvement for which we are all responsible.

I welcome these amendments, because I think they will add to the basic securities legislation we now have, and I presume that at the committee stage of the bill a variety of details can be discussed at some greater length.

Mr. Renwick: Mr. Speaker, I also would like to have a word about the chairman of the commission. I think he is much too level-headed to take all the remarks that were made about him tonight quite to heart. The important thing is that the first experiment by the commission in something called the revolving-door theory of chairmanship for the commission has been a very successful one.

I take some small satisfaction that it was a matter discussed in this assembly on a number of other occasions that in this particular commission this was an appropriate way in which the chairmanship should be established, that someone from among those knowledgeable in the industry should serve a specific period of time as chairman of the commission and return to that industry, and the sooner we had established the kind of acceptance of that process the better it would be for the regulation of the securities industry in the province. Mr. Baillie, during the course of his tenure, has not only established that principle but he has also established it in a way which I assume will continue to be the guiding way in which the ministry and the government will make the selection.

Mr. Baillie had, in addition, the opportunity of finally bringing to conclusion this process of the new Securities Act which had been going on for much too long. Too many amendments were required and the new act was too long in coming, but under his chairmanship we finally did achieve that particular event.

However, it poses an immense warning to this assembly. I say quite bluntly and quite candidly: Even in a minority government situation in the standing committee on the administration of justice dealing with this bill, when in theory at least the government’s intentions on a particular clause in the bill could have been amended by an amendment proposed and accepted by the two opposition parties or in the assembly, there was not a single amendment proposed by anyone in this chamber that was accepted.

The reason it wasn’t accepted, of course, is that we were bit players in a process in which this Legislature was not involved. It was not involved for a number of reasons, not the least of which is that when you have a single statute and a series of detailed regulations about a particular industry, there is a pool or a school of experts in the financial community, in the legal profession, in the accounting profession and in the others who become so highly expertise in the understanding of all the minutiae of the regulations and the law surrounding the securities industry that it is very easy for those in that industry to treat this forum and these members with something less than having anything useful to say about the process of change and accountability.

[10:15]

I issue this warning to the minister, that that’s what happened in the case of this bill. It is no reflection on Mr. Baillie, because Mr. Baillie happened to come with a very high sense of public obligation and public duty to discharge to the commission. That was fortunate, but I want to say that the bill went through, I believe, something like six different versions and that none of them, except this final draft, got to second reading in the assembly. In other words, they had been gone over in minute detail, not in a public forum but in the offices of the commission with the representatives of the industry, over a considerable period of time, until they were so refined -- so refined in their interest, not the public interest -- that the bill which came before us was not capable of amendment.

We had the nerve in committee to propose a couple of amendments. I don’t need to go over them. They are amendments which could well and truly have been made in the public interest, but there was no way in which this assembly could amend that bill. I think it is a startling reflection on the accountability to this assembly of that commission that a bill of this magnitude and this complexion, while it was amended in committee not a single amendment was passed that was proposed by any member of this assembly. Each and every one of them were very refined, specialized amendments that came to light in this ongoing process of which this bill tonight is the next stage.

There was constant and continuous refinement by discussion between the commission and the industry. That is no reflection on the commission. The commission, as I said on second reading of the Securities Act in 1978: “ ... has all of the earmarks of that kind of a commission that requires public scrutiny, intense expertise, intense internal morale, intense sense of its public obligation, but so intense that every now and then, for example, it goes a little awry in its sense of what is and what is not in the public interest.”

It is quite interesting, for example, to read: “Relevant policy statements promulgated by the commission generally obligate issuers to make immediate public disclosure of changes in the issuers’ affairs that would be likely to affect the market price of their securities. The policy statements recognize that in certain cases the attainments by an issuer of valid business objectives might be compromised by public disclosure and that in such cases a delay in disclosure may be appropriate.

“In a recent situation, a large Canadian industrial company, whose common stocks are listed on the Toronto Stock Exchange, discovered that for the first six months of its fiscal year it would report earnings greatly in excess of its earnings for the corresponding period in the preceding year and greatly in excess of what had generally been anticipated.

“At the moment when this happy fact became clear, the issuer was in the process of settling a contract with a labour union that had struck one of its plants. The chief executive officer of the issuer telephoned a high-ranking Ontario Securities Commission staff member and explained that the company would prefer not to release the good news until after settling the labour contract. His call was consistent with the timely disclosure policy statements, which advised that if management has an unusual or difficult situation confronting it, it should discuss the matter promptly with the commission.

“The commission official, who apparently was somewhat troubled as to whether he had exercised his discretion properly, told the issuer’s chief executive that under the circumstances it would be permissible for public announcement to await the filing of the issuer’s six-months financial results in the normal course.

“Different people will have different answers to the question whether the desire on the part of an issuer’s management to secure the labour of its unionized employees at the lowest possible price constitutes a valid business reason for non-disclosure under the securities laws of a favourable material change in the issuer’s earnings, but it seems highly doubtful that if the question had to be confined publicly by rule rather than privately by telephone the provincial government or the securities commission itself would declare an ongoing collective bargaining situation to be a valid business reason for non-disclosure of favourable developments relating to the issuer.” If the regulator would not put itself on the line publicly it is doubtful that it should do so privately.

That focuses the point I want to make: that this assembly or a committee of this assembly has to devise a method by which it does not abdicate knowledge of what is happening in the financial markets of this province to the expertise, however well motivated and however well established and entrenched, of the Ontario Securities Commission in that very close relationship it has established with the industry.

A second example, Mr. Speaker, is that under the single clause which says that the commission has power to order the Toronto Stock Exchange and to give directions in all other things to the Toronto Stock Exchange, it is very significant that practically all of those relationships are done in private and by telephone, not by direction.

I want to make it very clear that I have very serious reservations about the process which is going on. I say to the outgoing chairman, with the greatest respect, that during the period of time when his term of office may be ending and his successor may be coming into office he instill, at least in his successor, what I believe the chairman of the commission at this time has for this assembly, some degree of respect about the responsibility of this assembly in this field.

I say to the minister that he has to ensure this assembly a method by which a committee of this assembly is seen to have a close working relationship in this building with the ongoing processes of change which take place in the minutiae of this highly sophisticated business we’re involved in. Let me perhaps suggest a possible avenue by which this could be accomplished.

By the way, I want to pay a minor tribute to the Ontario Securities Commission. In this morning’s Globe and Mail under the byline of Stan Oziewicz there was the article about “Ontario’s Use of Secret Rules Well Hidden, Researcher Says” and talks about “secret law” -- that is all of the internal rules and regulations that are not available to the public at the present.

I want to say that does not apply to the securities commission. I think by and large there isn’t something called secret law hidden away in the interstices of the commission. Their requirement is full, complete and true disclosure of all of the affairs of the corporate issuers, and in a funny way that has worked within the commission so they’re a fairly open body. I did want to make the point that despite what may be the case in the Workmen’s Compensation Board and other agencies of government and in the interstices of government ministries, that’s not one of the failings of the Ontario Securities Commission.

Let me compliment the commission on what I think may be a possible avenue by which some of my concerns can be allayed with respect to this question of accountability in this chamber. The commission has very rightly done what we have tried to urge the government to do on many occasions. That is before filing and publishing the regulations in final form, to provide a forum by which detailed and complicated regulations for which we grant authority in almost every statute could have some public exposure and discussion before they are finally promulgated.

It is very interesting that under the aegis of this commission, under the chairmanship of Mr. Baillie, seminars were held, I believe three or maybe more. Three or four seminars were held at which the regulations were made available in draft form, and were discussed in detail. The commission came forward and explained those regulations as they related to the new law which was coming into force. The result was that those who had to live with those regulations had a real opportunity to understand what was in them.

I would hope some other ministries of the government would adopt the same procedure with respect to detailed and complicated regulations. We happen to have a body which performs an abortive function in this House called the standing committee on statutory instruments. Anybody who has sat on that particularly dreary committee perhaps would welcome its use as the body before which regulations under such statutes as the Securities Act or any other act, the Environmental Assessment Act for example, would be referred in draft form for public input, public discussion and public understanding.

I’m quite certain this suggestion will not be picked up by this government, but it is a suggestion that might possibly provide the link between this assembly and the Ontario Securities Commission. I say that because of the funny process of the establishment of the words that actually find their way into statutes. Our regulatory powers are so broad they have already found their way in many cases into the regulations and it’s only after they have had a refinement in that process that they become amendments to the actual statute. So the standing committee could very well perform that useful function. The securities commission and the industry would come to a standing committee of this assembly and the expertise which is lacking among most of the members of the assembly about the workings of this highly sophisticated and knowledgeable field would be seen here and would be understood. The member for Armourdale (Mr. McCaffrey), for example, would be an ideal person to be part of that process.

I’ve talked about those two or three matters because they are of immense concern to me, and should be to this assembly. That elitist, proud group who administer the securities laws of this province from time to time have to understand that noblesse oblige is no satisfactory substitute for the public interest, and this is the place where the public interest is.

That is not to chastise the commission. It is the fault of this assembly that we have allowed it to happen. I, for one, was very upset to have sat through the committee hearings of the Securities Act, which was passed and is in force as of last September, and to find that this assembly couldn’t change one jot or tittle of that legislation even when there was a majority in the assembly. I need not rehash the occasion when we could have passed an amendment to the act and in all good faith we accepted the deferment of it so that it could go back into the digestive process. It never ever did quite come back again and so we do not have the one amendment that might have been passed.

I have gone on at much too short a length, but it appears to be about 10:30. I think the remaining items could be well dealt with in this bill in committee of the assembly.

Mr. T. P. Reid: Mr. Speaker, I’m not sure the bill is ready to go to committee yet. I would like to adjourn the debate.

On motion by Mr. T. P. Reid, the debate was adjourned.

[10:30]

ESL PROGRAMS

Mr. Speaker: Under standing order 28, a motion to adjourn has been deemed to have been made. The member for Oakwood has indicated his dissatisfaction with an answer from the Minister of Education dealing with English as a second language for Asian refugees.

Mr. Grande: Mr. Speaker, on November 16 I asked the Minister of Education to inform the Legislature in a clear, concise, unemotional manner how many provincial dollars have been allocated or will be allocated to boards of education to set up English-as-a-second-language classes for the 6,000 refugee children the ministry itself expects will be entering Ontario’s schools within the next 12 to 14 months.

Approximately 800 of these children are already here in Metropolitan Toronto alone. The minister also said 90 per cent of these children do not speak any English or French. The minister’s answer was the weighting factors within the legislative grants will accommodate almost all these children. As far as I’m concerned, in the minister’s own words, that is factually incorrect. As a matter of fact, in my own words, I will say to the minister that it is total and utter nonsense.

The minister obviously should be more knowledgeable in terms of how the grant structure functions from the Ministry of Education and how provincial dollars flow to the boards of education. The minister should know how the weighting factors work. Let us take an example. If a teacher of English as a second language started to work in September 1979, the teacher is counted in the June 1980 board report. In June 1981, the weighting factor recognizes this teacher and generates provincial funds. In other words, it is approximately 15 months after the fact that provincial funds are generated.

I don’t think the minister should go unchallenged in always saying the grant formula generates money. Clearly, this is an emergency situation. I would like the minister to be addressing this problem in a more serious manner.

In answer to my supplementary, the minister returned to saying the grants are going to look after the problem. As far as I’m concerned, this stubborn attitude of the Minister of Education is definitely not going to help the education of the 6,000 refugee children who are going to be coming into this province within the next 12 to 14 months.

Two possible courses of actions will follow if the minister does not recognize the intensity of the problem. One is the boards would have to rely on the local resources they have. If those resources are not adequate, so be it. Hundreds of children will sink by being placed in the regular classroom, a classroom in which they don’t understand the language the teacher speaks. This certainly is not a way to treat the introduction of immigrant children into the school system.

If the boards do have local resources and can muster local resources, that particular burden is going to fall totally upon the local taxpayers. I’m sure the minister realizes this situation is a very sensitive one and certainly not conducive to the education of the immigrant children, when the community around them begins to feel it has to absorb the whole shot of this education on a regressive property tax.

Clearly, the minister has the information, which was provided during the justice committee hearings, at which she was not present. Therefore, the minister should not really be shocked at the figures I used in my November 5 question.

What the minister should be doing as fast as possible is conduct an inquiry into this situation and to begin to put in the money so that boards across this province can look after their needs.

In the justice committee, we had an answer from the minister to that particular problem; that answer said the ministry is actively looking at ways to provide additional financial assistance to boards that provide this particular service for the refugee kids.

The minister herself is going backwards in saying the grant structure will look after the problem. The minister has to look seriously at this problem, and playing the numbers game is certainly not going to do any good to the thousands of children who need English as a second language; not only the Vietnamese kids who are coming in --

Mr. Speaker: The honourable member’s time has expired.

Mr. Grande: -- but also those children who are not getting the proper ESL language classes right now.

Hon. Miss Stephenson: Mr. Speaker, in the several months since the influx of Indochinese children, primarily Vietnamese children -- began to occur in Ontario, there have been approximately 1,812 who have arrived in this province.

At the present time, in the mid-northern region there are 12; in the northeastern region there are 38; in the northwestern region there are 39; in the eastern region there are approximately 500; in the western region there are 302; in Metropolitan Toronto -- in the central region -- there are 921; totalling 1,812 students.

These students are concentrated primarily in the city of Toronto, although, as I suggested, there are a number who are in other areas of the province. The Toronto Board of Education has 760 students at this time and estimates the extra costs that will be incurred for teachers, interpreters, educational assistants and translation services will be approximately $100,000 in the next year, and not the figure of $1 million to which the member for Oakwood alluded. The North York Board of Education has approximately 900 students within its jurisdiction at the present time, and feels it may need to hire a community relations officer as well as extra teachers above the formula that is appropriated to it. The other five Metropolitan Toronto school boards have an average of 12 students each within their systems at this time.

It’s interesting that the mid-northern region, with a total of 12 students, is attacking the problem in one way. The northeastern region has a very special situation in that three school boards in the northeastern region are co-operating to provide services in one location for all of those students. The 36 children, and the adults who have accompanied them, have not been integrated into any regular educational system at this time, but are being taught through a mechanism that has been established, uniquely, by that board.

The northwestern region has approximately 40 students, including 14 in the Lakehead board and 13 in the Fort Frances-Rainy River board. As I said, the western region has approximately 302, and the city of Ottawa has almost 500, accounting for that number in the eastern portion of the province.

Under the ministry’s regular funding arrangements, school boards receive funding for provision of education for every new Canadian student who enters the school system in Ontario. In addition, there is appropriate funding over and above the regular per-pupil grant, and it is provided to school boards for programs and services for newcomers in English as a second language as well as in French as a second language.

These arrangements apply to all the newcomers who come into the province, and most certainly will apply to the Indochinese refugee students from Vietnam. But we anticipate, based on available estimates at this time, there will probably be about 50,000 Indochinese refugees in Canada within the next 18 months, and we anticipate about 20,000 to 25,000 of those will settle in Ontario, about half of whom will be school-age children.

We had anticipated they would arrive within the province at the rate of about 1,000 per month, but that rate has not as yet been met; the arrivals have been at the rate of about 400 a month over the last several months. As I suggested earlier, and as was mentioned by the honourable member, about 90 per cent of this total number of children will speak neither English nor French.

The funding mechanism is there, it is in place for dealing with these children, but because of the nature and the size of the problem, although the weighting factors for 1980 have not been totally finalized in the general legislative grant, the language instruction weighting factor for Indochinese refugees is certainly going to reflect current programs and services. The number of English-as-a-second-language teachers providing programs and services for Indochinese pupils in 1980 will be used in the calculation of the language-of-instruction weighting factor for that year.

We intend to move to a current funding basis for this program in order to ensure that no board is disadvantaged in attempting to meet this increased responsibility, which weighs heavily upon the boards but which reflects the generosity and the kindness of Ontario people and the people of Canada.

The House adjourned at 10:40 p.m.