32nd Parliament, 1st Session























The House met at 10:01 a.m.



Mr. Smith: Mr. Speaker, I wish to raise a small matter to correct the record. In this morning's Globe and Mail there is an article on the subject of acid rain and the Ontario Hydro sale. It quotes me as having said that the sale will increase Hydro's new sulphur dioxide emissions by 27.9 per cent.

In fact, if one looks at Hansard one finds that this is not what I said. What I said was that "fully 27.9 per cent of Hydro's SO2 emissions will be due to this particular purchase." In other words, it is not that emissions would increase by 27.9 per cent but rather that fully 27.9 per cent of the total emissions in 1990 would be due to that sale.

Hansard is correct in this matter, but the article is slightly incorrect.


Mr. Martel: Mr. Speaker, may I ask the House to consider the possibility of extending question period this morning because of that great document -- or lack of substance -- that was tabled last night in Ottawa and because there are many questions we would like to raise? Can we get the unanimous consent of the House to extend question period for possibly up to half an hour to get some input from the government or some form of response to what transpired last evening?

Hon. Mr. Wells: Mr. Speaker, I appreciate the fact that my friend is not very happy with the federal budget, but I think the hour we have is adequate for a full discussion of this matter.

Mr. Cassidy: Mr. Speaker, I hear that the government House leader is not granting unanimous consent. I find it outrageous that, the day after the budget comes down, the Minister of Industry and Tourism (Mr. Grossman) is absent, the Minister of Education (Miss Stephenson) is absent, the Minister of Health (Mr. Timbrell) is absent, the Premier (Mr. Davis) is absent and, in fact, the vast bulk of the cabinet is absent and the government is not in a position to respond on the effect of the budget on the people of this province, a budget that will have an enormous and deleterious effect on many people across the province.

Where the devil is the cabinet, and why is the government House leader not exercising stewardship on behalf of the people of Ontario?

Hon. Mr. Wells: On this point, Mr. Speaker: It is very nice for my friend to get exercised. He is trying to pull a little one-upmanship, as he always does. He knows that the Treasurer (Mr. F. S. Miller) is going to make a statement in a few minutes and that he will be here to answer and discuss this fully. There will be plenty of time next Monday for in-depth discussions with the operating ministries.

But if the member is ready to debate this at this time and is not just playing a little one-upmanship, if he is really concerned about the people of Ontario and Canada, I ask him to enter into some legitimate debate with the Treasurer.


Mr. Speaker: Before the routine proceedings, I would like to respond to a matter raised on Thursday, November 5, when the member for Ottawa Centre (Mr. Cassidy) and the member for Sudbury East (Mr. Martel) asked for direction with respect to occurrences on Tuesday evening, November 3.

I was asked to say whether I considered an attempt to raise a point of order constitutes debate, the implication being that, if not, the words in standing order 36, "the original question shall be put forthwith and decided without amendment or debate," would not exclude such action. The answer, of course, is no.

However, when I declined to hear from the member for Brant-Oxford-Norfolk (Mr. Nixon) and the member for Ottawa Centre on Tuesday night, I felt strongly that the wording of standing order 36 was so very clear that there could be nothing out of order; and the House is aware that many times my predecessors have declined to hear points of order when they were convinced that nothing was out of order.

I felt, and still feel, that it was analogous to a member who had attained the floor in a proper way moving the adjournment of the House for the purpose of putting the question under debate out of consideration completely. I submit that on such a motion there can be nothing out of order, and the Speaker would be correct in ruling, as many have done, that he will not hear a point of order at that time.

On Tuesday night, I sensed the mood of the House was fast reaching the point of grave disorder, and I decided it best to recess for a cooling-off period and to have the opportunity of consulting with the House leaders. During this recess, I received submissions from them and, although still convinced that my interpretation of standing order 36 was correct, in order to facilitate the business of the House, I agreed to proceed, by agreement with the House leaders, to hear the two alleged points of order and to deal with them in the House.

Apparently, this willingness on my part to consult and to co-operate is seen by some as a sign of indecision. I truly regret this. However, I respectfully submit that surely it is the duty and the responsibility of the Speaker to ensure the business of the House is carried on with dignity, in a spirit of co-operation and in a expeditious manner. I submit this was not the case on Tuesday evening, November 3, and I point out to all the honourable members that the Speaker can only preserve decorum and order by having the co-operation of all members. I further submit that, had I not recessed the House at that time and sought consultation and advice, there would have been a complete breakdown, and the business of the House would have drawn to a halt.

Further, the member for Ottawa Centre, when he was allowed back in the House, made reference to the fact of his being readmitted after having been asked to withdraw from the service of the House. I remind the member that there is no lack of precedent for this action, as he may well remember, having been readmitted to the House by Speaker Reuter on June 22, 1972, after representations had been made on his behalf by his former leader, the then member for Scarborough West.



Hon. F. S. Miller: Mr. Speaker, yesterday evening, Mr. MacEachen introduced, on behalf of the government of Canada, his new budget. I have learned to be very careful and deliberate in my analysis of Mr. MacEachen's budgets. Given both the volume and scope of information contained in it, anything beyond general comments would be premature at this time.

I remind honourable members that items like established programs financing, while they may not be of immediate concern to the average taxpayer, can have a real impact on his or her pocketbook. Therefore, we will be looking very closely at anything in the budget affecting these programs. My staff, in fact, will be in Ottawa on Monday to meet with their counterparts. I will reserve detailed reaction until they report back to me on the results of that meeting.

I do, however, want to outline for the honourable members my general reaction in several areas. First, I believe there are a number of positive measures contained in the document. I am happy to give Mr. MacEachen credit in those areas where I believe he deserves it. My only regret is that he did not take some of those steps earlier.

10:10 a.m.

Ontario is pleased that there were changes in the marginal tax rates. In my pre-budget submission to Mr. MacEachen, I had urged that the top marginal rate should be reduced to 36 per cent at the federal level. Last night's actions exceeded my expectations, with a reduction to 34 per cent highlighting a package of marginal rate reductions. I see this as an important and needed incentive for the taxpayers of this province.

I am pleased to see that the federal government has taken at least minimal action to ease the burden on home owners. We have consistently said that interest rate problems were a federal responsibility, and we are glad to see that Mr. MacEachen has accepted this view.

At the same time, I am more cautious in my support for measures taken by Mr. MacEachen in other areas. The action to aid farmers is a welcome and positive initiative, but I am concerned that the $50 million allocated will be woefully inadequate.

Every member of this House knows the deep concern I have for the health of our small businesses. It is indeed this sector from which much of our future job growth will come. At the moment, however, I feel there is some ambiguity about what the net effect of the budget will be on small businesses.

I also support the budget's objective of equity and recognize the need for closing loopholes in the tax system. However, I am concerned that some of their steps, like the removal of deductibility for the borrowing costs of registered retirement savings plans, may work against the benefits achieved by their lower marginal rates and affect many middle-income Ontario taxpayers.

There are certain aspects of the budget with which I am very disappointed. Perhaps my greatest disappointment is with its lack of a real economic development thrust. Despite the claim that one of the three basic themes of the budget was economic renewal, and despite the publication of a document on that purported federal economic strategy, there was little of substance. There were no specific program announcements.

We in Ontario have specific projects under the Board of Industrial Leadership and Development program in which we have invited federal participation; yet we still have no indication that this will happen.

Mr. Smith: You might have asked them before you launched an election campaign.

Mr. Speaker: Order.

Hon. F. S. Miller: We talked to them, and the member knows it.

Mr. Smith: It was nothing but an election gimmick, and you know it.

Mr. Speaker: The Treasurer will proceed, please.

Hon. F. S. Miller: The grapes are sour.

Economic development has not received any increased priority. This is despite the fact that the federal government has gained huge new revenues out of the recent petroleum pricing agreements with the producing provinces. Ontario alone will pay out $11 billion more over the period from 1981 to 1986 as a result of these agreements. Yet there is no evidence that the new federal energy revenues are being used for economic renewal in Ontario, the hardest-hit province. I have called for the reinvestment of petroleum revenues, but that clearly has not happened. In fact, Ontario consumers will now bear a double tax burden.

I also question the wisdom of imposing a new tax burden on the Ontario economy in the way of tax increases on corporations in the coming year. This comes at a time when there is a need to increase productivity growth through increased capital investment. Yet the cash flow of the business sector will be adversely affected just when they need more funds to replace capital equipment made obsolete by rising energy prices and technology.

At this point, let me say that while I generally applaud Mr. MacEachen's desire to reduce the federal deficit, I trust that he is standing ready to undertake stimulative measures if the economy deteriorates further. Consumers are already paying a huge tax increase from petroleum price hikes, and Mr. MacEachen should be sensitive to further erosion in consumer spending.

Mr. Cassidy: The problem is here, now -- not later.

Mr. Smith: How many ways do you want to have it? Do you want Reagan or do you not want Reagan?

Mr. Speaker: Order.

Hon. F. S. Miller: The proposals made by the finance minister on the fiscal arrangements are extremely complex. This area of the budget in particular will need extensive examination of the numbers before I go to the finance ministers' conference on November 23.

One thing is clear, however: The proposed elimination of the unconditional revenue guarantee means that Ottawa is merely transferring a sizeable chunk of its deficit to the provinces. The effect on the resource-rich provinces will be much less than on the provinces that are fighting increasing deficits. Ontario, for example, has the choice of either raising taxes, reducing services or increasing the deficit.

The overall effect of Ottawa's action on these arrangements is to increase the fiscal disparities among the provinces.

I have given only preliminary comments on a few of the points raised in yesterday's federal budget. As I have said, I intend to examine these and other issues in greater depth.



Mr. Smith: Mr. Speaker, I have a question for the Treasurer, who did not mention that Ontario could save $650 million by the simple expedient of not signing the Suncor deal next week.

Will the Treasurer tell us whether he is now prepared to give any assistance to home owners, farmers and small businessmen, since he stated recently that he would prefer to piggyback any provincial programs on to federal programs when it comes to helping those who are hardest hit by high interest rates?

Is he willing to bring into this Legislature either a budgetary statement or, at the very least, certain programs which would add provincial assistance to the somewhat minimal federal assistance that has been outlined for home owners and farmers and the almost nonexistent assistance for small businessmen?

Hon. F. S. Miller: Mr. Speaker, I do not want to rule out any kind of action. I pointed out in my statement that the budget is quite complex; it deals with perceptions. The immediate perception to most taxpayers is that it helps them but, if one looks below the gloss and the rhetoric, there are a number of tax moves that affect average people.

Mr. T. P. Reid: My God, they've taken a leaf out of your book.

Mr. Eakins: You've had a lot of experience.

Mr. Speaker: Order.

Mr. Smith: This is dull compared to BILD.

Mr. Breithaupt: Or keeping the promise.

Hon. F. S. Miller: We are doing it very well. Would that his party were doing it as well.

Mr. Breithaupt: We will be eventually.

Hon. F. S. Miller: In any event, it is a recognition that a change in leadership might change the direction.

My colleague the Minister of Agriculture and Food (Mr. Henderson) addressed one specific part of the honourable member's question, and I and others are looking hard -- notice how the Leader of the Opposition (Mr. Smith) is listening? Notice the attention my response is getting? Is he going back to teaching when he is finished here? As an old school teacher myself, I would say he would have had detention every day.

Mr. Smith: I have had no success in teaching you. I think I will give up on it.

Mr. Speaker: Mr. Treasurer, would you please proceed to answer the question and not ask questions?

Hon. F. S. Miller: You are quite right, Mr. Speaker.

In terms of agriculture, I think the honourable member will find we will be working quite hard on programs to try to help the agriculture industry which, by themselves, would not necessitate a mini-budget.

I really want the time for my staff and myself to have a complete review of the complex detail after the Ottawa visit on Monday and after the meeting of finance ministers, I think a week this Sunday, in Halifax. Then Ontario will be able to tell better whether there is any specific need for a reaction. My impression today is that there will not need to be a mini-budget.

Mr. Smith: Perhaps when the Treasurer rises to his feet again he might address whether, if there is not going to be a mini-budget, there might at least be programs of a provincial nature to piggyback on to the federal ones to help farmers and small businessmen as well as home owners.

Given that there will be changes by virtue of the revenue guarantee alterations which will mean that, for instance, post-secondary education might be in some jeopardy, will the Treasurer undertake that Ontario will increase the provincial contribution so that our university system can survive?

Recognizing that even if the Treasurer were to absorb the total federal cutback when it comes to the post-secondary system, Ontario's share would still be far less than it was proportionately before the established programs funding arrangement came about, and given that Ontario has taken advantage of the EPF to reduce its funding of universities below inflation, will the Treasurer agree to make up the shortfall in federal payments in this regard, keeping in mind that would still not require Ontario to return to the proportionate level of funding that existed before EPF started?

10:20 a.m.

Hon. F. S. Miller: The member has singled out, as he tends to do, post-secondary education as if the funds from the federal government were earmarked. I am sure he knows they were not. Last night, Mr. MacEachen was quite careful to say he was not changing EPF money and so left the impression that there should be no reason for the provinces to worry about the cost of health and post-secondary education, when on a net basis, according to his own figures, he is taking about $440 million per year off our provincial revenues by the end of the fifth year. The net effect of all those tax moves and transfer changes to Ontario I think is on page 55 in the tables in one of his background books.

It is interesting to see how we compare with other provinces. If we look at the net effect on our neighbours in Quebec, it is $25 million, the same as the net effect on Newfoundland. I found that intriguing. The net effect on Alberta was about $200 million a year, and the net effect on British Columbia was about $100 million. Those are all reductions. For him to imply that does not transfer a problem to me is not realistic.

The member says we kept the transfers to universities at a rate lower than inflation. That is true. But he also knows we kept the average growth rate of all Ontario spending below inflation in the interests of the taxpayers of the province, because we wanted to cut down our deficits at a time when those of the federal government were rising horrendously.

Mr. Cassidy: Mr. Speaker, will the Treasurer undertake that students, people who benefit from health services and people who benefit from social programs in this province will not be forced to pay user fees and that the Treasurer will not make the people who can afford it least pay the cost of the $1.9 billion the federal government proposes to take away from Ontario in terms of its proposed federal savings and provincial revenues over the next five years? I say to him, do not take that out on the poor.

Hon. F. S. Miller: I cannot yet make any such commitments, Mr. Speaker. It is great to say somebody can cut my revenue off and I should maintain all the services and not raise taxes or consider other ways of raising revenue. That is a fairy-tale world. I have to live in a world where income and outgo are roughly balanced. If somebody cuts off my sources of revenue, I may have to do something about my spending. That is the way the world is.

Mr. Smith: Will the Treasurer please explain why he feels it is so necessary to raise taxes whenever revenues go down for fear of increasing his deficit when his government has just increased the deficit 47 per cent to purchase an oil company?

Hon. F. S. Miller: We will get into the use of words at this point. I did not change my deficit by one cent with the Suncor purchase.

Mr. Smith: Your net cash requirement went up 47 per cent.

Hon. F. S. Miller: That is a different thing.


Mr. Smith: Mr. Speaker, I have a question for the Minister of Energy. I believe the minister was in the House when his colleague the Minister of the Environment (Mr. Norton) said the energy to be sold to General Public Utilities across the Lake Erie cable might not be generated from coal in a significant proportion and might come from nuclear, from hydro and from the whole grid.

Since the minister knows better than that, will he draw to the attention of the Minister of the Environment that the pricing agreement between GPU and Hydro is based entirely on the price of coal at the various coal-generating stations? Will he also draw his colleague's attention to the letter of intent, page two, which is strictly saying that significant quantities of coal-fired energy can be made available to GPU? That is what the whole agreement is about.

I ask also whether he will draw the attention of the Minister of the Environment to Ontario Hydro's input in front of the National Energy Board last year, which I will now read to the minister: "Almost all of the electricity exported from Ontario will come from coal-fired stations. Very infrequently, at light loads, some of this electricity may come from hydraulic or nuclear stations, but almost all of the exports will be from coal-fired stations."

I ask whether he will also tell the Minister of the Environment about the testimony of Mr. McIntyre of Hydro in front of the committee last year, who said: "It is a bit ironic: We are selling power right down to the place we are buying the coal from. We are buying coal down there, shipping it up to Nanticoke, generating power with it and sending it back down." And he said: "The reason this is economical: we happen to have surplus coal-fired capacity available."

Given the fact that this deal is obviously for coal-fired electricity, can the minister explain the ignorance of the Minister of the Environment on this matter? How can it be that the Minister of Energy and the Minister of the Environment have talked so little that he still imagines the electricity might come from other sources?

Hon. Mr. Welch: Mr. Speaker, I am sure what my honourable colleague was sharing with the House is the fact that Hydro will, of course, use plants that cost least to produce electricity. We have reason to believe, on information I have received recently, that on the basis of current projections it is possible that about 30 per cent of the exports to GPU will be from nuclear energy. But I certainly do agree that a substantial percentage, the remaining 70 per cent, will come from coal-generated electricity.

Mr. Smith: Will the minister share with the House his reasons for thinking that 30 per cent will come from nuclear energy? If that substantial amount will come from nuclear, will GPU accept responsibility for the nuclear waste that is created by that 30 per cent?

Furthermore, I ask the minister whether he is not familiar with the submission of Hydro to the National Energy Board, which said: "If the definition of 'international power line' is extended beyond the last point of isolation, in Ontario Hydro's case there would be no reason in principle not to define the whole Ontario Hydro grid as an international power line."

They were making the argument there that only coal is being used for export and that Bruce was not for export. The minister will recall there was an accusation being made that the line from Bruce was an export line, and Hydro said, "Oh no, all we export is coal-fired electricity." They said, "It would follow from such an interpretation, if Bruce were to be considered for export, that the whole Ontario bulk power system would require certification by the National Energy Board."

Given that the minister knows this deal is based totally on coal prices and is expected to be fundamentally a coal deal, will he explain to us why he thinks 30 per cent will come from nuclear and, if so, why the entire Ontario bulk power system should not be required to be certified by the National Energy Board?

Hon. Mr. Welch: As we indicated, the application for the licence for the interconnection will be before the National Energy Board, and many questions no doubt will be asked at that time. Indeed, the whole matter of economic and social impact will be before that federal body.

I am advised, and I repeat, that Ontario Hydro will seek to produce its electricity from its low-cost plants. I also repeat that I am advised that, based on current projections, it could be a 30-70 split between nuclear and coal. I also point out that, because of the policy of this government on the export of electricity, electricity customers of this province enjoy about a seven per cent benefit because of the revenues that Hydro generates through these export sales, and that will no doubt improve as a result of this one if all the approvals are obtained and a final contract is agreed to.

With respect to coal, as the honourable member will know, if by chance this agreement is not formalized and the delivery of electricity to this utility is not accomplished this way, one of the alternatives is to buy from, say, Ohio, which uses coal generation completely as its base. The environmental implications for this province from that type of activity would be quite serious.

10:30 p.m.

Mr. Foulds: Mr. Speaker, in view of the Minister of Energy's apparent and enormous attempts to be open and frank with the people of Ontario about the various agreements his ministry and its agents enter into, will the minister, in an effort to be helpful, table in this House the application before the National Energy Board at the same time it goes to the energy board, if not before?

Second, if there is an indication that Ontario Hydro plans to generate approximately 30 per cent of the electricity for this export purpose from nuclear power, is it in the minds of Hydro and the Ministry of Energy that they will expand that 30 per cent, using the export contract as an excuse to expand their nuclear commitment over the next few years when that expansion is not necessary within Ontario itself?

Hon. Mr. Welch: Mr. Speaker, I will address both questions from my friend.

First, I assume all documentation that is part of the application before the National Energy Board is public information, but I will get some advice as to the timing with respect to that. I am addressing in particular the point as to whether some information would be available prior to the formal application. If the honourable member will allow me, I will check into the possibilities of such things as whether we would be violating anything as far as the National Energy Board is concerned. It would be my impression that all documentation submitted would be public, because it is for a public hearing.

In response to the second part of that question, all I can point out at the moment is that, based on our present projections, that should be the mix as Hydro looks ahead at the most efficient way to produce the electricity that will be needed to honour that contract.

Mr. Smith: I ask the minister again if he will table now the basis for his statement that only 70 per cent of what will be sent to GPU will be coal-generated, since all the contracts and testimony given before now have implied that well over 90 or 95 per cent, if not 100 per cent, would be due to coal. Will he table any reasons he has and give us the benefit of the understanding he seems to have that 30 per cent will be nuclear?

Will he respond to this question: If we are sending clean electricity down to GPU, using nuclear energy to produce it, are they prepared to take the concomitant waste or are we going to be stuck looking for a place to put it?

Hon. Mr. Welch: As the Leader of the Opposition knows, there is a co-operative effort on the part of this government, Ontario Hydro and the federal authority with respect to this whole question of nuclear waste disposal, and we have given reports on that from time to time.

All I can do is repeat with respect to Hydro that, as it looks ahead to fulfilling its obligations under this contract, on present projections, that happens to be the breakdown with respect to the fuel source for that particular electricity.


Mr. Cassidy: Mr. Speaker, my question is for the Treasurer about the mini-budget. Can he explain why he has now virtually rejected having a mini-budget for Ontario, despite the fact that the federal budget figures tabled last night indicate unemployment in Canada will rise to 7.8 per cent in 1982 -- it is actually higher than that now -- and then to 8.3 per cent in 1983, to 8.3 per cent in 1984, to eight per cent in 1985 and maybe a bit less in 1986 and 1987?

When we are faced with almost a whole decade in which unemployment will rise to a third of a million Ontarians or more, why is the Treasurer not prepared to bring in a mini-budget now to create jobs here in Ontario?

Hon. F. S. Miller: Mr. Speaker, I was careful in answering the question. I said it was my belief at the moment that a mini-budget would not be needed but I did not rule out any other actions or programs that might be required. I think the member should give me the time I think one should take to assess the whole budget.

One thing I want to say is, if there is a glaring error in this budget, it is that the federal government did not attack the creation of jobs in this country at all. I think we both agree on that. In fact, it is cutting its cash requirements significantly during a recessionary period when most governments would be content at the very worst to keep their cash requirements level. We have lectured the federal government enough on budgetary restraints so I cannot really complain about measures to reduce deficits. But I also have to warn them they should not necessarily do it in the very year there are problems with employment.

The cash requirement cut is achieved by two measures, oil revenues and cuts in transfers to the provinces. We said these were the two techniques that really hit Ontario twice. Had they used, as we suggested in 1979 and thereafter, some of the oil revenues to stimulate the industrial economy of this country and particularly the heartland of Ontario they would have been making better use of some of those moneys.

Mr. Cassidy: The Treasurer knows by now we are faced with a federal government and a federal finance minister whose real name is Allan MacReagan because of the way he has bought those American economic policies and tried to import them to Canada.

Will the Treasurer undertake to bring in a budget for this winter which will provide for short-term job creation and which will initiate the industrial strategy for Ontario that is so conspicuously lacking in the federal budget and that will impose an excess profits tax on banks operating within Ontario? Will he use those profits to help home owners, farmers and small businessmen who are hurt by high interest rates?

Hon. F. S. Miller: The leader of the New Democratic Party managed to roll quite a few things into one question. He got his favourite whipping boy, the banks, into it.

Mr. Cooke: They are your friends. You are the one who defends them all the time.

Hon. F. S. Miller: They happen to be an integral part of the whole Canadian fabric. While it seems popular in the NDP to always hammer them they happen to be some of Canada's world class institutions. They earn about half their money outside this country and if they took it all it would probably take one per cent off interest rates. Let us keep our economy healthy by keeping its parts healthy in our own way.

The NDP tend to believe that any economic development policy decision should be made by a central authority. That has been a classic socialist theory.

Mr. Foulds: That's nonsense and you know it.

Hon. F. S. Miller: It is not nonsense. Every time that party wants to get into the act, that is how they want to do it. They really do not have any faith in the average businessman's ability to make good, sound, common-sense decisions for this nation. I have a lot more confidence in those businessmen than they have and I am going to keep on having it.

The Board of Industrial Leadership and Development document that is scorned so often by the NDP because it works, because it did them in, was a very good outline and plan for the development of the Ontario economy. What is most important and what was lacking last night --

Mr. Martel: Chrysler, Ford, Massey-Ferguson -- you are bailing them all out. Don't give us your craptrap.

Mr. Speaker: Order.

Hon. F. S. Miller: The member has his r's and l's mixed up.

Mr. Martel: You know what kind of trap I am talking about.

Hon. F. S. Miller: He had to swallow in between. Mr. Speaker, I have lost track. As the member for Sudbury East (Mr. Martel) has done so effectively so often, he has totally derailed me -- as he did the trains running in his area.

Mr. Sweeney: Supplementary, Mr. Speaker: The minister himself recognizes the moves that have been made are not sufficient to help home owners, farmers and small businessmen and to increase employment. Since he is not prepared to introduce a mini-budget at this time, what other measures do he and his officials have in mind to deal with these problems which he himself recognizes need more attention?

Hon. F. S. Miller: I tried to point out that there is a tendency in the media, the Legislature, wherever, to take a pile of documents like this -- which kept me and a lot of people awake a good part of the night -- and the next morning sound as if they had made a total, complete, detailed analysis of them. I started my statement by saying it will take me time to do that. Even if I make that assessment, the assumption of the members opposite of a repository of knowledge that would solve all those problems once we have analysed them is also a bit foolish. The problems are not easily solved or someone would have solved them long ago. This province has done, by the admission of all the other provinces and the federal government, the best job in the nation of managing its affairs and creating --

10:40 a.m.

Mr. Smith: That is your opinion.

Hon. F. S. Miller: It is not my own opinion.

Mr. Smith: You know we are tenth and last in this country and people will listen to that when they lose their jobs.

Hon. F. S. Miller: You tried that out for a long time. No one listened to you then, and no one will listen to you now.

We acknowledge and the federal government have acknowledged two or three measures on the housing front. First, it is going to help people who have equity in homes by having interest they cannot afford to pay guaranteed until a later date. Second, if they do not have equity in their homes, it is willing to give them up to $3,000, I think it is, per year to help them stay in their homes. Third, it has a program, which we as yet cannot quite assess, of providing $7,500 interest-free loans for some 15,000 rental units in Canada.

Ontario already has a program like that, often belittled by the party opposite. The federal government is copying us. What we need to know is whether they are piggybacking us, whether we are getting 40 per cent of the money, 40 per cent of the units; whether it adds on to the Ontario program or not. For me to respond until those questions are answered is not right.

Mr. Laughren: Supplementary, Mr. Speaker: The Treasurer admitted there was no economic strategy in the budget as it would apply to Ontario and he seems to imply he is not going to bring in any kind of mini-budget. Will he tell us what kind of benchmarks he has in his own mind about the level of activity in Ontario that would motivate him to take some action? I am referring to things such as the level of unemployment and the decline of the economy in particular regions. At what point does the Treasurer have a sense he needs to intervene to stimulate the economy during this difficult winter ahead of us?

Hon. F. S. Miller: The member assumes we have never done anything. That is implicit in his question. The fact is we have done quite a bit. The Ontario budget was welcomed both last year and this. The mini-budget last year announcing the BILD program was welcomed. We have taken specific measures like the sales tax relief on automobiles, scorned again by my colleagues opposite, aimed at one of our major industry's health in the last --

Mr. Laughren: Will the minister answer the question?

Hon. F. S. Miller: I am trying to. If I do not give the member the answer he wants, I am sorry, but it does not mean it is not there.

Mr. Eakins: Will the minister take off the accommodation tax at the end of the year?

Hon. F. S. Miller: Oh, come on. There is no magic point where one suddenly triggers a lot of reactions, and the members know it. One takes measures as the time and conditions require them. One thing Mr. MacEachen said last night I agree with. I do not know whether it was by coincidence that yesterday the interest rate dropped a point and a half. I would like to think it was. It would seem the gods and the budget came together on the right day, if that was the case.

Knowing the federal government really does manage that market to a large degree, I sense maybe last week's interest rate drop could have been greater and this week's interest rate drop would not have been quite as great had market forces alone dictated them.

Mr. MacDonald: You cynic.

Hon. F. S. Miller: Am I a cynic? Do you agree with me?

Mr. MacDonald: It's the operation of the free market, you cynic.

Hon. F. S. Miller: The Liberals never did operate a free market. Here in this House they masquerade as right-wing entrepreneurs, but if they were in power the real left-wing points of view would come out, as they have in Ottawa, and as they would if they got back into power in this province.

One thing Mr. MacEachen said last night I agree with completely --


Mr. Speaker: Will the Treasurer please ignore the interjections and proceed to answer the supplementary. Order.

Hon. F. S. Miller: The cacophony of sound from the opposition is always an indication we are getting on track. Mr. MacEachen last night said one thing I hope the members agree with. I did, putting aside all partisan points of view. He said the most important stimulus to the economy of this country will be a reduction in interest rates.

They went down yesterday. There is every reason to believe they will continue to go down at least for the next short while and I would suggest that will have an immediate impact on housing starts. It will have an immediate impact upon people making decisions on consumer credit and a number of other areas that can have a good effect on the economy.


Mr. Cassidy: Mr. Speaker, I find it ironic that the Treasurer was prepared to bring in a mini-budget last year when there was one winter of bad unemployment ahead. This winter, when there is much worse unemployment, and going ahead for six years according to the federal government projection, he is not prepared to move.

Mr. Speaker: Question please.

Mr. Cassidy: My question to the Treasurer is this: The federal program of relief for home owners will assist only some 5,000 home owners here. The federal government has prepared estimates saying 27,000 home owners will be in dire straits and will be facing 30 per cent or more of their income having to go to pay their debt, even if interest rates stay at 18 per cent. Would the Treasurer say what, if anything, the government of Ontario plans to do in order to assist that large number of home owners who will not benefit from the federal program, but who are in dire straits because the mortgage is coming due in the coming months?

Hon. F. S. Miller: Mr. Speaker, we asked the federal government to bring in some program for the people who are having the greatest problems. They brought in a program. Obviously they can increase the dollars allocated to it if they think it is working. We would do that in Ontario if we had a program that was working and required more help. I would suggest we see the effects of that program before immediately jumping in and clouding the issue.

Mr. Cassidy: How does the minister square the fact that if we get 40 per cent of the federal program, only 5,000 people in this province will be entitled to that federal assistance, and yet the government of Ontario estimates there are some 27,000 home owners who face a gross debt service ratio exceeding 30 per cent of their income? What is going to happen to the remaining people? Are they going to have to lose their homes before the government is prepared to act? Is that the policy in Ontario?

Hon. F. S. Miller: The honourable member would have it be my policy. I do not know where he gets his 5,000 figure from. It may be in there. There is a 15,000 rental unit program of which we assumed 40 per cent would come to Ontario, either in dollars or in units. That is not what we are talking about in terms of mortgages and housing. We are talking about supporting the number of people with the $400 million the federal government put to one side to help. Those are two separate programs.

Mr. McKessock: Supplementary, Mr. Speaker: The small business development bond has now been expanded to unincorporated businesses and farmers. This bond was hard to get before, so would the Treasurer consider guaranteeing this bond, similar to the way the young farmers credit program is guaranteed? The government guarantees it at prime plus one per cent, which is more than 20 per cent, or has been. This small business development bond would only be about 10½ per cent. It makes more sense to guarantee a credit program where the government would be only risking 10½ per cent. Would he consider guaranteeing this small business development bond now so that more people can make use of it?

Hon. F. S. Miller: Mr. Speaker, in reading over the information in Mr. MacEachen's budget on the extension of the small business development bond -- first for another year and second to a class of unincorporated farmers -- one has to recognize he put in a new condition. That is that they be in difficult circumstances. I do not know how one defines that. That is one of the vague terminologies that could either work with reasonable interpretation in the interests of many or make it very difficult to get any help.

I think one would have to see the availability of money in the marketplace before jumping to the conclusion a guarantee would make the difference. I suspect the farming community will welcome that. We talked to the Ontario Federation of Agriculture a couple of weeks ago on this matter. I told them that at my last meeting with Mr. MacEachen we had asked for the extension of the small business development bond to unincorporated farmers, if possible, and also to operating moneys instead of capital moneys. That appears to have been done.

10:50 a.m.

Mr. McKessock: It is hard to get.

Hon. F. S. Miller: Sure it is hard to get, but all money is hard to get. Guarantees make it a little easier but not that much easier, as we have discovered in a number of circumstances.

People tend to see the small business development bond as due to the largess of the federal government, and they forget that through the tax systems of Canada, Ontario parallels that and absorbs its share of that saving. I hope the member appreciates that. We said we would, and we are doing it. It is lost revenue to Ontario and to the federal government, which I think is a good investment in the community.

Mr. Philip: Supplementary to the original question, Mr. Speaker: Since the construction industry is now predicting a shortfall of as many as 30,000 homes this year in this province, and since this will have an inflationary effect on the cost of homes and on the size of the mortgages to be carried, what new initiatives will this government now undertake to encourage new housing starts in the province to make up that shortfall?

Hon. F. S. Miller: Mr. Speaker, I think that question should properly go to the Minister of Municipal Affairs and Housing (Mr. Bennett) in due time rather than to me.

Mr. Speaker: New question.


Mr. Speaker: Order. The rotation is for the official opposition.


Mr. G. I. Miller: Mr. Speaker, I have a question for the Minister of Energy. Can he assure the people of Ontario that, if the project of putting a new cable across Lake Erie goes through, the scrubbers will be in place before the contract is signed, particularly at the generating station at Nanticoke, so the sulphur dioxide can be controlled and the people of Ontario will not be subjected to an intensification of sulphur dioxide emissions from the increased generation?

Hon. Mr. Welch: Mr. Speaker, a commitment is obviously in place that there will be the reduction to which reference has already been made. Within this time period there will be a reduction in total emissions by 50 per cent. I have no reason to believe there will be any cause for concern about that. In other words that commitment will be honoured.

Mr. G. I. Miller: Supplementary, Mr. Speaker: They are planning to put in two scrubbers at the present time at the Lambton station, and I feel that Nanticoke should have priority. Why does the minister not consider installing them at Nanticoke rather than at Lambton?

Hon. Mr. Welch: Mr. Speaker, as the honour- able member will remember, the commitment is with respect to total emissions. I do not think that where the scrubbers are actually installed is as important as the commitment to reduce total emissions by 50 per cent. I think we have to keep that quite clearly before ourselves and the people of this province.

I invite the member opposite and other members of this House to tell me what other utility in North America is committed to a 50 per cent reduction of this type of emission in the 1980s. I think this is a very positive thing we should be reminding ourselves of.

Mr. MacDonald: Supplementary, Mr. Speaker: Would the minister be more specific about this 50 per cent reduction he speaks of? My understanding is that the regulations require a reduction to 450 megagrams up until 1989 and to 300 megagrams after that. Who came up with those regulations? Has there ever been an environmental assessment to determine whether they are adequate to halt the destruction of lakes? Or are we going to wait until all the lakes are destroyed in the 1990s?

Hon. Mr. Welch: Mr. Speaker, I imagine a number of factors will be taken into account in arriving at the totals. I think the important thing is that on the basis of this type of investment there will be this total reduction. I do not know of another utility in North America that has --

Mr. MacDonald: I don't care about that.

Hon. Mr. Welch: I think that is very relevant in a comparative way. We are moving very positively as a jurisdiction to respond in this way and to reach that goal, and I think that is something we should underline in a very positive way.

Mr. G. I. Miller: Supplementary, Mr. Speaker.

Mr. Speaker: That was the final supplementary.


Mr. Speaker:. Order. There were two supplementaries to the original question which is what I --

Ms. Copps: There was the original question, a supplementary, one supplementary and then back to the original.

Mr. Speaker: No, with all respect.


Mr. MacDonald: I have a new question of the provincial Treasurer: Is the Treasurer aware that Ontario's share of the $50 million made available last night for subsidization of farm interest rates amounts to about $16 million? That is approximately three per cent of the outstanding agricultural debt in Ontario at the moment. The province of Quebec, through its own efforts -- forget the federal government -- is making available about four times as much which is $67 million or $68 million. Last year, before the election, when this government was looking for votes, they offered $25 million as a subsidy and only $5 million was spent.

Will the Treasurer give a commitment as soon as he has assessed the whole situation that at least the $20 million that was cancelled after the election will be available to double the amount of subsidy available to Ontario farmers? Then he could perhaps add to it at a later point.

Hon. F. S. Miller: Mr. Speaker, I will not give that commitment but I am certainly looking at the problem. I am not even sure, from the way the budget read, whether the $50 million was extra capital given to the Farm Credit Corporation or whether it was the cost of the interest subsidy. If it is the cost of the interest subsidy, it is not so bad. If it is a five per cent subsidy, which it says it is -- five per cent brings the FCC rate down to 11.25 per cent -- then obviously it would go 20 times as far in terms of loans, would it not?

One would have a lot more credit subsidized if the net cost of the program to the federal government is $50 million. That is one of the questions I would like to see resolved before jumping in too quickly.

The honourable member has brought up a good point and we are not disagreeing on this at all. I was criticized fairly severely -- fairly or not does not matter -- for only putting, so far, about $42 million of Ontario's money into farm support programs, basically for beef and pork, over and above the regular ones this year. If $42 million of Ontario's money for Ontario's farmers in two sectors has not touched their problems, what is $50 million going to do for all of Canada and all of Canada's farmers?

Mr. MacDonald: Supplementary, Mr. Speaker: We agree it is woefully inadequate. That is another area where the Treasurer and I agree. It is woefully inadequate.

That being the case, will the government at least give a general commitment without the specifics for the moment that Ontario now must move in and do what the federal government has been unwilling to do, and what every other province across this country, in varying degrees, has already done?

Hon. F. S. Miller: Again, Mr. Speaker, I think he chose Quebec as the example.

Mr. MacDonald: Alberta, Nova Scotia, Saskatchewan --

Hon. F. S. Miller: Yes. Let's look at their fiscal capacities and where they get their money from. One of the things that keeps bothering me and my colleague, the Minister of Agriculture and Food (Mr. Henderson), is that Quebec's programs in particular are used for comparison. They appear to support their farm community very handsomely. I guess if I were going to be the recipient next year of an estimated $2.2 billion, basically of Ontario taxpayers' money --

Mr. MacDonald: That's outrageous. That has nothing to do with it.

Mr. Speaker: Order.

Hon. F. S. Miller: It certainly does.


Mr. Haggerty: I have a question to the Minister of Revenue, if I can get his attention.

Will the minister advise the members if an amendment to the Retail Sales Tax Act or its regulations has been considered? At the present time citizens are not compelled to pay sales tax at the time of purchase. Does his ministry intend changing this to enforce the sales tax being paid at the time of purchase?

Hon. Mr. Ashe: Mr. Speaker, if and when we feel the situation is a problem, we will naturally evaluate all the options open to us, and that is one of the options that has to be given serious consideration. It is not seriously being looked at now.

Mr. Breithaupt: Supplementary: Would the minister advise how many persons have been reported to him with respect to the refusal to pay sales tax, particularly in the Peterborough area?

Hon. Mr. Ashe: I do not have an up-to-date number as of today, but unless there has been some significant change -- and I would suggest if there was, I would be aware of it -- the grand total is something like 20.

11 a.m.


Mr. Mackenzie: Mr. Speaker, I have a question for the Treasurer. Has the Treasurer taken a serious look at the budget's background documents and the scenario in terms of unemployment laid out for Ontario? Has he taken a look at the inflation rate of 9.4 per cent, which means eight per cent unemployment, and 10.4 per cent, which means nine per cent unemployment? Unfortunately we are probably looking at a higher figure than that, given the current situation.

With 319,000 people in Ontario already out of work and with the federal budget being a clear blueprint for additional unemployment, for more plant closures and for more people out on the street without jobs, will he tell us specifically what he has in mind in the way of job creation programs? Will he now take a look at some of the serious recommendations we made in both the full employment and industrial strategy papers where we asked for additional notice for justification of plant closures and measures that would protect workers?

Hon. F. S. Miller: Mr. Speaker, those kinds of questions were part of some of the previous ones I tried to answer. I feel Ontario did quite a bit in the last year in that direction, probably more than any other province in Canada and certainly more than the federal government. I am disappointed in its actions. It does not mean I have a large battery of programs ready to go. I have reserved any reaction until at least a week has passed and we have examined all the implications of the federal budget.

Mr. Mackenzie: If the Treasurer is really telling us he has no programs whatsoever in the hopper, where do we stand in terms of providing employment for the workers and why can he not at least take a look at some form of protection in terms of earlier notice and plant closure justifications? Surely he is not admitting to the comment made by my colleague last night that, when he looks at a Liberal and Conservative federal budget, it is the difference between cholera and leprosy.

Mr. T. P. Reid: It's rabies you've got.

Hon. F. S. Miller: One can become rabid in here. There is no question about that.

Mr. Breithaupt: Only if you bite an NDPer.

Hon. F. S. Miller: At least it is something I can get my teeth into.

I would say we probably disagree more fundamentally as parties on some of the issues the member is touching on -- that is, how much the state should do in those areas than in any other area. The idea that any of us in this country can protect our economy against lack of competitiveness in a world market is wrong. We have to recognize a lot of people in this House are buying competitive products, be they automobiles, television sets or whatever, because it costs them less. At the same time, they want to protect their sources of income. They cannot have it both ways.

Mr. Ruprecht: Mr. Speaker, I wonder if the Treasurer realizes he has a solemn responsibility to create jobs for all those unemployed in this province. That means he somehow has to deliver the new policies and programs that are essential to bring this province back to normal. I repeat what the honourable members before me have said: What does the Treasurer have in his hopper? What new policies will he deliver to this House that will get our work force back to normal?

Hon. F. S. Miller: Mr. Speaker, I think that is exactly the same question.

Mr. Ruprecht: That is precisely because you didn't answer it, and we request that you answer the question.

Mr. Speaker: Order.


Mr. Elston: Mr. Speaker, I have a question for the Minister of Correctional Services. In the light of an article that appeared in the Toronto Star on November 8 concerning overcrowding in the Don Jail, I wonder what immediate steps have been taken by the ministry to take care of this emergency situation. Can the minister tell us what specific measures he and his staff are working on to remedy the situation on an ongoing basis?

Hon. Mr. Leluk: Mr. Speaker, in answer to the honourable member's question, there is a degree of overcrowding, particularly in the Metro institutions. My staff and I have been addressing this problem and we are working on solutions. I wish to point out, however, that the degree of overcrowding has not jeopardized the security of these institutions. I want to assure the members of this House that we have adequately trained staff and adequate facilities to look after that aspect of our job.

We have a number of community programs in Metro, and in particular we recently opened a bail hostel here in Toronto that will relieve some of the pressure on these institutions. We are currently upgrading the security fence at Mimico Correctional Centre in Etobicoke to maximize the use of the available space at that institution to provide for up to 150 selected inmates. This will take a considerable amount of pressure off the Toronto Jail and the west and east detention centres.

We continue to meet with judges from the criminal division to make them aware of some of the alternatives to incarceration. For example, we have a number of community programs, as I mentioned earlier. We feel these community programs, together with the upgrading at Mimico Correctional Centre, will relieve the immediate overcrowding problems at the three institutions.

Mr. Eakins: Mr. Speaker, since overcrowding creates problems with the minister's staff, is he satisfied that the people working in the institutions are properly trained? It seems to me from time to time there are many people in the minister's employ who feel they have not had adequate training. Has the minister monitored the situation in the various institutions to make sure his people are being adequately trained?

Hon. Mr. Leluk: Mr. Speaker, in answer to the member for Victoria-Haliburton, we feel our line staff or correctional officers receive adequate training. Last year, for example, we spent an additional $1.3 million in upgrading this training. We have a number of auxiliary or adjunct staff who also receive training, but maybe not to the degree the full-time staff receive. We feel in the ministry that the training received is adequate for the purpose.

Mr. Speaker: A new question; the member for Windsor-Riverside.

Mr. Cooke: Mr. Speaker, I have a question --

Mr. Ruprecht: On a point of order, Mr. Speaker: There was one question here from my colleague and then another question over there, but no supplementary was permitted.

Mr. Speaker: I will explain the procedure once again. When we are dealing with questions from private members, I allow one question, the main question, and one supplementary. I then go over to the other party and recognize a final supplementary. The third party in this case did not have a final supplementary; so I recognized the member for Windsor-Riverside with a new question.


Mr. Cooke: Mr. Speaker, I have a question for the Treasurer regarding the Volkswagen deal, which was announced a few weeks back.

I have a document prepared by Volkswagen, dated August 12, 1981. On page four of the document, it states, "The only reason for Volkswagen to engage itself in a study of this project is the prospect of obtaining freedom of duty for importation of vehicles." It goes on to say, "Thus, Volkswagen is willing to consider such investment in return for freedom of duty at the site of its economic and operational preference."

This entire document prepared by Volkswagen concentrates on and talks about the deal that was made between the federal government and the provincial government and says it is economically feasible because of duty remission.

Can the Treasurer indicate clearly to this Legislature and to the taxpayers of the province why it was necessary to give $9.2 million to Volkswagen to locate in Ontario when it is clear from Volkswagen that the reason it came to Canada was not for a handout from the provincial government but for duty remission? Is it not clear that the government gave it the grant for one reason: to score political points?

Hon. F. S. Miller: With voters in Germany? Come on! No.

Mr. Cooke: That is a pretty stupid response.

Hon. F. S. Miller: No, it is not. The member for Windsor-Riverside is a very strange person. He stands up and criticizes this government day after day about not doing enough for the auto industry, but the moment something happens in a place other than Windsor he has to criticize it.

11:10 a.m.

Seriously, it is very important in this world of international automobile assembly, component construction and world cars that we start getting our share of parts manufacture for vehicles wherever they are assembled. That requires some kind of duty remission to parallel the auto pact type of agreement. That is a federal government domain.

The fact is that, even with the duty remission, we understood there were powerful incentives for them to stay in the United States and not in Quebec. Therefore, after considerable negotiation by our Ministry of Industry and Tourism, it was decided there was a need to assist.

I would rather be accused of having given away $9.2 million for 500 jobs in Barrie than not to have them because we did not.

Mr. Cooke: No one is criticizing the government because they got 500 jobs. The fact of the matter is that they did not get them; it was the federal government that negotiated the deal.

Mr. Speaker: Question.

Mr. Cooke: I want to know clearly what the minister and his government got in return for the $9.2 million, over and above the 500 jobs that were guaranteed to the federal government for duty remission, over and above the 85 per cent Canadian value added that was negotiated by the federal government and the 30 per cent for in-house production by 1987 that was guaranteed to the federal government for duty remission. What did he get for our taxpayers' money that justifies giving this?

Hon. F. S. Miller: First, they are in Ontario. The member knows full well that the federal government tried every trick in the book to get them to go to Quebec and almost lost the whole deal. There was a tremendous reaction in Quebec on that one basis. We had made our offer before there was any intervention by the federal government to move them to Quebec, and the member knows that too.

What do I get? I get 500 more employed people in this province, and I get my share of employed people's revenue through the tax system to help pay for the services of this province. If that is not enough for a government to expect, then the member does not understand what it is all about.

Mr. Wrye: Mr. Speaker, given the fact that the deal giving Volkswagen duty remission was concluded even before Ontario formally opened discussions with Volkswagen concerning this grant, and given the fact that to get a duty remission agreement from the federal government Volkswagen had to commit itself to go to a site it had chosen in Barrie, why was it necessary -- I will repeat it once again -- for Ontario then to turn around and give the company $9.2 million?

Hon. F. S. Miller: Mr. Speaker, I do not think the honourable member has his facts straight. The fact remains that we almost lost the deal in the final analysis, not to Quebec but to the United States.

Mr. Cooke: Oh, don't give us that! They wouldn't get duty remission for that.

Mr. Speaker: Order.

Hon. F. S. Miller: Now that it is here, it is nice to sit there and pontificate and be sure. The fact is that it almost went -- and I know that; I am not just guessing that.

Mr. Laughren: On a point of order, Mr. Speaker: In view of the fact that this appears to be another example of how the Treasurer spends taxpayers' money without reference to the Legislature --


Mr. Speaker: Order.

Mr. Laughren: May I complete my point of order, please?

Mr. Speaker: Yes. Go ahead.

Mr. Laughren: Can I ask the Treasurer to table in this Legislature a compendium of information dealing with this entire Volkswagen deal?


Mr. Speaker: Order.


Mr. Bradley: Mr. Speaker, I have a question for the Minister of Community and Social Services, and I regret that I have not had the opportunity to ask this question in his estimates. It is in regard to the potential for a core residence for the severely handicapped, most particularly the mentally retarded, in St. Catharines.

Application has been made by the local association. Will the minister clarify whether the reason this has not been approved yet is that there are budgetary restraints, or is it because of an overall policy in which he wants, in effect, to avoid this kind of housing, which I guess one would call the semi-institutionalization of people. Which of those two is the reason that this has not been approved to this time? I am sorry; I know it is difficult to ask the minister about one specific instance when he has responsibility for the whole province.

Hon. Mr. Drea: It is not because of budget allocation, Mr. Speaker. I am not familiar with the circumstances of the application. I will be glad to look into it for the member, but it does not seem to me that core residences would fit into the category of a mini-institution. I will get back to him.



Hon. Mr. Bennett moved, seconded by Hon. Mr. Baetz, first reading of Bill 167, An Act to validate Certain Road Closings and Conveyances in the City of Ottawa.

Motion agreed to.


Hon. Mr. Wells: Mr. Speaker, I wish to table the answers to questions 176, 180, 181, 182, 183 and 184 standing on the Notice Paper. (See appendix, page 3508.)


House in committee of supply.


On vote 701, ministry administration program: item 1, main office:

The Deputy Chairman: The member for Sudbury East.

Mr. Martel: Mr. Chairman, there are a couple of issues I want to raise with my friend.

Mr. Stokes: The minister has not finished his response.

The Deputy Chairman: Did the minister not finish his response?

Hon. Mr. Bernier: No, Mr. Chairman. I had not finished my response to the two leadoff speakers from the opposition parties, and I would like to continue. I realize the member for Sudbury East has a question he would like to ask. Does he just have one question?

Mr. Martel: No, I have two. Go ahead and finish your response.

Hon. Mr. Bernier: It will take me a few minutes.

If I may go back to my remarks and respond to these two members' contributions and their concerns, particularly about the economic development that is occurring in northern Ontario, I believe the member for Lake Nipigon (Mr. Stokes) referred to and questioned my remarks concerning sectoral economic development. I found where I had made that remark, and it related to such things as agriculture, tourism, mining and forestry, those thrusts where we are assisting other ministries in doing a number of different things in those particular fields. So it is a very broad general statement.

11:20 a.m.

The member for Rainy River (Mr. T. P. Reid) has just stepped out for a moment; he has some constituents here and he wishes to meet with them, but he has advised me he will be back to participate in the examination of these estimates. The member made a comment that the total budget of the ministry had not increased substantially.

I remind the members that while our budget this year is $156,255,300, there is in addition to this about $9 million of supplementary estimates, which brings the total amount for which we are asking the members' approval to $165.6 million. That is up about five per cent over the 1980-81 figure.

Since the ministry was formed four and a half years ago, our budget increase has been in excess of 31 per cent. I think this speaks well for the way the government is responding to the unique and special needs of northern Ontario.

The member also commented with respect to the improvement of management of our resources. He made special reference to agriculture, saying there was not sufficient emphasis by the Ministry of the Northern Affairs with respect to that sector of our economy.

In these estimates, there is about $600,000 that we flow to the Ministry of Agriculture and Food for a number of programs it administers on our behalf. That takes in a broad range of programs dealing with assistance to purchase commercial fertilizer, land clearing and breaking, purchasing of weed sprayers, assistance for fencing, educational travel and assistance for the purchase of hogs and sheep. It is a $600,000 package that is real. In 1981-82, we are planning to give assistance in the Rainy River district of about $67,000. This gives some idea of the thrust we are putting into the field of agriculture.

We are very much involved with the Timiskaming testing centre, agricultural technology in the Timiskaming area, which is going exceptionally well; we funded that for the last two or three years. The results of those studies are most encouraging. We are also involved with the wild rice study program, through Lakehead University, to the tune of about $100,000; that will be spread over a period of time.

Our involvement with regard to forest management is extensive. In 1981-82, we will have about $6 million in that program, and in future years about $11 million. Fifty per cent of that is recovered from the Department of Regional Economic Expansion program.

In the area of mining support, the members are aware of the funds we put into the Atikokan economic geological support. That was an aerial survey of the mineral potential in that area done along with the Ministry of Natural Resources. It was quite successful. A lot of mining activity has been accelerated by that program. That was funded by the Ministry of Northern Affairs.

In the location of suitable aggregate supply across northern Ontario, we will spend $173,000 next year to locate possible sources of that valuable resource.

We are also involved in assistance to trappers with an air inventory of their trap lines; we will spend about $76,000 this year or next in assisting trappers to locate live beaver houses. We will work closely with them and the Ministry of Natural Resources, which does the implementation of this program.

It can be seen from that list we are involved in a broad range of programs that deal directly with the management of our resources.

The honourable member also commented with respect to the highway budget that he thought it was declining in some instances. I wish to point out that this is certainly not the case. If anything, there has been a substantial increase in the funds that we are pouring into the Chapleau construction program in northern Ontario, through the Ministry of Northern Affairs.

Such roads as the Manitou Road, and even the Detour Lake Road, are a result of increases in the Chapleau construction program. When you look back, in 1977-78 we spent about $46 million on highway construction, and in 1981-82 that will be up to $72.3 million, a massive 71 per cent increase. That speaks well for that program also.

Mr. Stokes: Not so.

Hon. Mr. Bernier: Well, I would like to see it more; there is no question about that. I will never be satisfied until all the --

Mr. Stokes: Are you saying that Detour Lake Road would not have gone ahead unless you built the road?

Hon. Mr. Bernier: Yes, Mr. Chairman, we were the lead ministry in that particular project. The funds are flowed through --

Mr. Stokes: It would have gone through whether you built the road or not.

Hon. Mr. Bernier: No. I have to take exception to that comment, Mr. Chairman, because it was as a result of our insistence and our direct involvement through the lead ministry concept that the government met with the Detour Lake people. We met on a number of occasions with the local people prior to Dome coming on the scene, because we felt very strongly that there should be a major development that would see economic benefits flow to Ontario.

As you know, Mr. Chairman, Detour Lake mine is only 30 miles from the Quebec border. They have a winter road there now. It goes down into La Sarre, Quebec. There was some real possibility of that road being constructed from Quebec into Detour Lake. A week before the Premier (Mr. Davis), the former Provincial Secretary for Resources Development, Mr. Brunelle, and I went into Detour Lake, the highways minister of Quebec had been into the Detour Lake site to look at that potential.

Mr. Stokes: Quebec employees did the land clearing; is that right?

Hon. Mr. Bernier: They may be doing it now, Mr. Chairman. There is no doubt that much of the employment --

Mr. Stokes: You are using taxpayers' dollars to provide employment for the people of Quebec.

Hon. Mr. Bernier: It is an Ontario contractor; we do not direct where he should hire people to do the work. The company did tell us some of the employees who would be engaged in the project would come from Quebec because of their mining experience and their availability. There is no question about that.

It was incumbent upon this government to use everything it is empowered with to encourage the company and to put up the dollars for access into the Ontario site, which we have done.

Mr. Martel: The second lowest bidder was a contractor from the Sudbury basin, and he did not get the work.

Hon. Mr. Bernier: Labelle is doing the big part of the work, and I am particularly pleased the way my ministry handled that project.

The member for Rainy River mentioned and questioned my personal involvement in the hog producers' problems of northern Ontario. I researched that problem. While he is correct in pointing out that their regulations, which were passed by this government, do not really apply in northern Ontario, and the Ontario Hog Producers' Association does not extend its area of influence into that area, there are historical reasons for that.

If the northern Ontario hog producers were part of the Ontario Hog Producers' Association, they could not export their product to Quebec, Manitoba or even the United States, but would have to funnel their product down to southern Ontario; up until this point in time they have individually resisted and have enjoyed the freedom of selling their product where they wished.

But I want to put on the record that if there are sufficient hog producers in northern Ontario who want to belong to the organization, and to deal with the consequences of funnelling all their product down here, I am prepared to lean on the Minister of Agriculture and Food (Mr. Henderson) to make the necessary amendments, if not to the regulations, then to the legislation. For obvious economic reasons, I do not think that will happen, but I leave that idea with the member.

11:30 a.m.

The member for Rainy River also touched on the recruitment program for the Ontario North Now staffing. I believe the member for Lake Nipigon also made some reference to the changes that were implemented this year.

As members are very much aware, that very successful northern Ontario pavilion was opened last year for the first time. It was opened for three weeks last year. We, as a ministry, had the full charge of staffing the nine pavilions. We went to northern Ontario and engaged all northerners. I might say it was very successful.

Mr. Stokes: That was last year, not this year.

Hon. Mr. Bernier: That was last year, yes. We looked after their transportation and their accommodation here in Toronto. We engaged people under the policy age of the Ontario Place itself. Many of our people at Ontario North Now were under the age of 18. It took a lot of work on behalf of our staff, and I might say that Sheila Willis, who is the director of our information branch, did a tremendous job really in babysitting that group of northerners last year; that was for a three-week period.

Then we entered into an agreement with the Ontario Place management by which they would take over responsibility for the maintenance, operation and staffing of the whole facility. There are a number of reasons for that, because they wanted to rotate the hosts and hostesses through the various pavilions. They thought if they had control of the whole aspect it would be much easier for them.

Notwithstanding that fact, we as a ministry will monitor and have full control of the displays that are in the pavilions themselves and will encourage the communities from northern Ontario to come down and sell their communities --

Mr. Martel: You should lay the timber to them and make them say they'll come to the north.

Hon. Mr. Bernier: I am going to get to that point. This year, I have to say, I was a little taken aback by the lack of northerners in the pavilion; I have to admit that. But we did supply two northern affairs officers, who were there on an ongoing rotation basis. The various communities were there on a weekly basis to sell their particular communities. The information staff of my ministry was there on an ongoing basis to co-ordinate the activities. So there was the northern Ontario presence.

Mr. Martel: But our kids can't even get jobs in the summer.

Hon. Mr. Bernier: Not to the extent that some of the members would like to see; I accept that. But we have already made it known to Ontario Place that, as a ministry, next year we will assist them and their recruiting team to go to the two universities in the north in an effort to encourage those students who may be interested in working at Ontario North Now.

There are some drawbacks for these students. They have to look after their own living expenses and accommodation, which we did last year but which we will not do this year because they are over the 18-year age limit. They will be asked to fall in line with all the other hosts and hostesses at the pavilion. We will try to work out something that will assist them with their transportation costs. I think that is something we can do over and above the other problems that may arise.

We definitely will have the Ontario Place people in both those universities next spring to do as much hiring as we possibly can and to engage a good spattering of northern Ontario students who are familiar with the north to be present in the Ontario North Now pavilion.

That has satisfied most of the inquiries I have received from right across northern Ontario.

I was particularly pleased with the member for Rainy River's comment with respect to the peat symposium and with the enthusiasm that he and the member for Lake Nipigon expressed with regard to our initiative in getting that started, because it was something that was lying there dormant. As I said in my opening remarks, when my assistant deputy minister and I went over to Ireland, we spent some considerable time meeting with the Irish people and looking at their operation and trying to translate that into northern Ontario.

Mr. Stokes: Do you never think of your friends at all?

Hon. Mr. Bernier: I will get to that point. In fact, I think on this point the member for Lake Nipigon made mention of a project in Quebec. I have to tell him that my interest is very sincere. I was going to suggest and make the offer --

Mr. Stokes: And of course, Anticosti Island in Quebec and Buffalo Narrows in Saskatchewan.

Hon. Mr. Bernier: I thought we would go to Quebec if we could find time. I would like to send an invitation to my colleague the member for Lake Nipigon and my colleague the member for Rainy River to join me on a visit to that island to look at the Quebec operation.

Mr. MacDonald: After you get the jet.

Hon. Mr. Bernier: After we get the jet, yes. Well no, we cannot wait that long.

Mr. Foulds: The jet probably will not land there.

Hon. Mr. Bernier: No? We will take the King Air; that is pretty comfortable. If the member for Rainy River and the member for Lake Nipigon are agreeable I will follow up on those arrangements, and if we cannot do it this year we will do it early in 1982.

I appreciate your interest in that resource. It is an energy resource we all know has not been tapped. It has not been tapped for economic reasons, there is no question about it. We learned very clearly and quickly in Ireland the reason they have tapped their peat resources is that they do not have the wood resources we have, nor do they have the coal or oil we have. It was obvious this was an energy resource that really had to be tapped, not only for the energy resource but for the job opportunities that would flow from the harvesting of the peat in Ireland. It has created economic benefits, not only from the flow of electrical power but for jobs that were nonexistent in the centre of Ireland. So I think we are on the right track --

Mr. Stokes: Five or six thousand jobs in Ireland.

Hon. Mr. Bernier: Yes.

Mr. Stokes: If they did that in northern Ontario that would be quite a leg up.

Hon. Mr. Bernier: No question. And I --


Hon. Mr. Bernier: Yes. I am pleased at the interest by the private sector. As many members are aware, there is a group right here in Toronto -- I think they are called Peat Resources Limited -- under Leon La Prairie, who has been very interested in getting some massive holdings in northern Ontario for some research work. Certain inventories have already been concluded, certainly by our involvement with the Ministry of Natural Resources and with the Ministry of Energy --

Mr. Stokes: All we need now is a peat policy in northern Ontario.

Hon. Mr. Bernier: Yes. I hope we will move ahead on that. So we have that in place, and I will certainly follow up on the visit to Quebec.

My deputy, who is retiring, asked me to extend his appreciation to both the member for Lake Nipigon and the member for Rainy River for their kind comments on his 35-year contribution to the civil service of this province. I regret he is leaving but he has served this province, this government, and certainly all members on both sides of the House, exceptionally well. I know he will be missed.

The member for Lake Nipigon referred to the sawmill situation in northern Ontario, and I share his concern. I hope this is a temporary situation where we are seeing a decline in the number of jobs, at least in the short run. I know my --

Mr. Stokes: It is temporary as it applies to markets, but it is not temporary as it applies to the --

Hon. Mr. Bernier: Yes. I will address that problem, but I want to talk about the jobs first. In my own home town of Hudson the mill is slowly winding down and we fully expect to see the plant mothballed for two or three months at least. This is due to policies of the federal Liberal government. It is because of the lack of an assault on high interest rates in Canada, which discourage building in this country, and also the high interest policy in the United States, which is really curbing sales of lumber on the other side of the border.

My colleagues the Minister of Natural Resources (Mr. Pope) and the Provincial Secretary for Resources Development (Mr. Ramsay) and I, along with the member for Cochrane North (Mr. Piché), met with the Hearst operators just a couple of weeks ago in Cochrane to discuss their entire situation. There is no question they are concerned about their future. They are concerned about the possibility of being cut back on the sale of chips. Once the economy starts to turn down we see the effects on the paper industry, with packaging going down and advertising slowing up. All this may curb the purchase of chips from a number of the smaller sawmills and further aggravate their situation.

So it is something we have to live with. I guess, all over the North American continent. We cannot tackle it individually, although we are concerned and we will be watching it very closely from our point of view.

The allocation process -- I believe one of the members referred to allocations to the sawmill industry. I had to look back, and my deputy minister brought it to my attention because he was with me when I was in Natural Resources, and we did try to address the wood allocation problems of the sawmill industry in a number of instances. I am sure the member from Sudbury will recall what we did in the Hornepayne area where we took something like seven townships away from the Ontario Paper Company to give to the Hearst operators. That was well received.

11:40 a.m.

At our meeting in Cochrane a couple of weeks ago the Hearst operators told us at this time, and at least for the next 20 years, their problem was not really directed to wood allocation but to sales of both chips and the product. In the short run that was their biggest concern, but beyond that they had no comment. My deputy and I are proud of the part we played in taking nine and a half townships back from the major licensee in the Fraserdale area and making sure Cochrane Enterprises in Cochrane was given these resources so it could put in a waferboard plant and a plywood plant. These are going to this day and will guarantee some long-term wood supplies.

In the town of Sioux Lookout we took back a sizeable chunk of timber that has been allocated to Great Lakes Forest Products in Thunder Bay and allocated those resources to a sawmill in the Sioux Lookout-Hudson area. Those were not easy things to do, but we feel the action we took was correct. I make no apologies for what we did. The jobs that flow from that are still there today and will be for some considerable time. The allocation in those two areas is well documented and quite firm.

The member for Lake Nipigon made mention of the economic thrust and spent some considerable time talking about Design for Development and the direction we are going. Like the member for Lake Nipigon and the member for Rainy River I was around when Design for Development moved to the northwest. I did some research following our comments at our last meeting and found about 80 per cent of the general recommendations had been addressed in Design for Development. It has served its term, its decade had run out, but I think the whole thrust of Design for Development can be felt today.

A number of things really happened because of Design for Development. I am sure the members for Lake Nipigon and Rainy River will agree the infrastructure programs we brought forward following Design for Development were quite massive across the northwest. The $33-million project that went into Thunder Bay alone had, as a direct result, improved facilities in the major urban centre of northwest Ontario. The construction of highways, the Dryden-Fort Frances highway, the improvement of Highway 599, the four resource roads, one to Valora and the one to Marchington Lake, are all part of Design for Development.

I think it is fair to say the thrust of the Department of Regional Economic Expansion --

Mr. Stokes: Designed to assist Sioux Lookout based on the resources in the riding of Lake Nipigon.

Hon. Mr. Bernier: I can tell the member the traffic from Pickle Lake uses the Marchington Lake road now on a regular basis when going to Winnipeg. In fact the member's good friend, Mr. Koval, assured me last week that his traffic has increased tremendously, as has the return on his investment, because he now has Sioux Lookout to serve on the Winnipeg-Pickle Lake run. It is very encouraging to use of the Marchington Lake road, so we are using resources in both ridings.

I think it is fair to say the major northwestern Ontario DREE agreement and the northern DREE agreement flowed directly from Design for Development. It saw some real thrust being made with respect to economic development right across the north. We hear little but gloom and doom concerning the north in southern Ontario, but when I travel to places like Elliot Lake I see the excitement. How many members have been to Elliot Lake recently? I wish the member for Algoma (Mr. Wildman) was here because the excitement going on in Elliot Lake today is unreal. The $3 million my ministry is putting into the sewer and water project is topping up what the Ministry of the Environment and the town are putting in. There are massive housing developments going in there.

Mr. Cassidy: For a year or more you drove them wild.

Hon. Mr. Bernier: I know the members, as northerners, share my excitement about what is happening in places like Elliot Lake and Blind River, the massive developments going on there. I ask the members to go to Timmins. Things are happening.

Mr. Cassidy: You glow with pride, eh.

Hon. Mr. Bernier: The leader of the New Democratic Party will know because he comes and visits once in a while.

Mr. Cassidy: Yes. That is right.

Hon. Mr. Bernier: And he sees changes occur on the horizon. Even some of the communities are changing their skylines because things are happening that fast.

Mr. T. P. Reid: And their members.

Hon. Mr. Bernier: And their members, yes. But I look at what is going to happen in Sault Ste. Marie -- more than $300 million by the Algoma Steel Company, a massive development. If the member for Rainy River goes to Dryden -- I go home every week and I am just amazed at Dryden's changing skyline. A $350-million development by Great Lakes Forest Products is going into that community. It will see the old mill set aside completely and a new one going up. It is exciting.

The members should go to Kenora and see what is happening in Kenora.

Mr. T. P. Reid: Layoffs -- 350 layoffs.

Hon. Mr. Bernier: There are going to be guaranteed jobs for 400 or 500 people there in perpetuity. With the bypass being started now around Kenora -- something that we have fought to get for some 20 years -- and of course the development at Minaki Lodge, it all adds to the excitement. So as you move around the north there is excitement, there are things happening that sometimes we forget to talk about and forget to relate to.

The member for Lake Nipigon made some reference to the new and exciting program, the air ambulance service. As northerners we are all excited about that. There is no question about it. To have four dedicated aircraft located --

Mr. Laughren: If you do not control your excitement, you will need the service yourself.

Hon. Mr. Bernier: Four dedicated aircraft --

Mr. Stokes: Bandage one to four.

Hon. Mr. Bernier: Yes, we have one to four. But to have four dedicated aircraft solely for the movement of those who have an emergency health need or are sick or being transferred from hospital to hospital -- for roughly 100,000 people -- I think is a major step forward. There is no question about it.

As the member for Lake Nipigon very rightly pointed out, it is a new program. It just started in July, and there are problems. I think he has likely heard of some of the operational problems in the north. But we have the program in place. We announced it would be a one-year experimental operational, that we would go through the four seasons and then have a six-month evaluation period where we would evaluate weaknesses and strengths of the particular program. They are starting to surface already, there is no question about that. We went to Sandy Lake and they rolled out a number of problems they found with the equipment.

But I was particularly pleased, Mr. Chairman, to be on the air ambulance inaugural flight that went into Sandy Lake and into Big Trout. We made a special point of getting the federal nursing staff down to look at the facility. Both of those groups pointed out that the air ambulance facilities were more modern and up-to-date than what they had in the ground nursing station. They would feel more comfortable in the airplane than they would in the nursing station. So I think that speaks well for the Ministry of Health and the way they equipped those aircraft.

The member for Lake Nipigon made some reference and questioned telemedicine. He wanted some information.

Mr. Stokes: There is the rub.

Hon. Mr. Bernier: No, I have the answer here.

I have it right here if I can just put my finger on it.

I did some checking with the Ministry of Health and the member will be pleased to know they have $3 million dedicated to telemedicine. The Ministry of Health has assured us the telemedical links with northern Ontario are a first priority with their ministry. As far as the Ministry of Health is concerned the project is going ahead.

I understand that within the last four weeks the Thunder Bay District Health Council has developed and submitted to the Ministry of Health a comprehensive proposal. The Ministry of Health has indicated to us their willingness to support this proposal and is trying to work out suitable arrangements with the Port Arthur General Hospital. I hope that allays the member for Lake Nipigon's fears. The program is moving ahead.

In all honesty there has been less than enthusiastic support from my area. The Kenora doctors and the Dryden doctors have not been jumping with glee about this program.

Mr. Stokes: That is not the case east of Thunder Bay.

Hon. Mr. Bernier: I understand that is quite correct. I suspect that is because of their closeness to the major health sciences centre in Winnipeg. But it is going ahead.

11:50 a.m.

Mr. Stokes: It was the doctors who urged me to ask you about it.

Hon. Mr. Bernier: It is on track and it is moving ahead.

We talked about the economic development thrust for northwestern Ontario. I am sure the members are aware we have reactivated the Municipal Advisory Committee under some new constitutional guidelines. It reports directly to the Ministry of Northern Affairs. We have set up Commerce Northwest, that is part of the Northwestern Ontario Associated Chambers of Commerce group. It is looking at the possibility of import substitution for resource machinery and equipment in the northwest. Of course you are all aware of the northern Ontario resources transportation agreement I signed on behalf of Ontario last March in Ottawa after some urging and nudging for about a year or a year and a half.

Along with the Board of Industrial Leadership and Development program I think we can safely say there are a number of initiatives moving ahead. I would be first to agree we have a few things going and we should have more. It is certainly my job to make sure we continue to have more and we will have more. I can assure you of that because that is the whole thrust of our efforts.

I welcome the suggestion by the member for Lake Nipigon that the Northern Ontario Development Corporation be transferred to Northern Affairs. I have said this on a number of occasions to my colleagues. It has not been received with any great enthusiasm, I might admit, but I think your assessment of our sensitivity to the needs of the northern business community is very real. I welcome that suggestion.

I noted the member's comments concerning the federal programs. I think we all share that concern about the lack of enthusiasm on behalf of the federal government. I want to get this on the record. I know the members are referring to the federal Department of Regional Economic Expansion programs and I think the member for Lake Nipigon made a good comment when he said, "We are wall to wall now with federal Liberals from North Bay to the Manitoba border, but it has not done us any good." I share that point of view.

Mr. Martel: They cut down the rail service.

Hon. Mr. Bernier: That is right. There is Via Rail, the Federal Business Development Bank which is a complete disaster, DREE. The list is endless. There is even the lack of licensing satellite television. The cost-of-living study to which the member for Lake Nipigon made reference is moving ahead with a great deal of enthusiasm. I am particularly pleased with the energy being displayed.

Mr. Stokes: Especially when your colleague the Minister of Consumer and Commercial Relations (Mr. Walker) went up to Fort Severn. He did not even know what was going on. He said there is really nothing we can do about food costs in the north.

Hon. Mr Bernier: We are going to try. I am impressed with the enthusiasm of the chairman, Rudi Wycliffe, who has been around the north and has held literally dozens of meetings and will be holding more. He has taken hold of this project with personal pride, I think. The other people from the other ministries who are with him are equally anxious to see if they can come up with some positive recommendations. The suggestions you have made are on the record and we will make sure he is made aware of them.

About the airport program, the member made reference to the thought by the remote communities that there would be a sudden downfall or at least a maintaining of the cost of living in the north because of the development of airstrips. I do not know if you have tried to explain this to our native people in the remote areas but the effects of inflation are very difficult to explain. Something that cost $1 five years ago now costs $1.50 down here. Add freight costs on top of that and it sounds unreasonable. They do not understand what inflation is all about. But the airstrip development program, I have to assure you --

Mr. Stokes: They understand it when they are paying $5 a gallon for gasoline.

Hon. Mr. Bernier: I know the members will agree when I say the cost of living in the communities where the airstrips are located today is slightly less, not a lot less, than for the places that do not have airstrips. Take Kasabonika as a good example, and Angling Lake. There is a difference. Take Big Trout Lake, Summer Beaver and Muskrat Dam Lake, places where they do not have an airstrip. They do not have airstrips there and the cost of living is extremely high. It is less in Bearskin Lake and Sachigo Lake. To make a blanket statement that it has not had an effect is not totally correct. It has affected the cost of living.

They can get bigger aircraft in there now and they have service 365 days a year. It removes the isolation, because those of us who live in the north realize that many areas were sometimes isolated for six to eight weeks in the spring and fall and that has now been remedied. Now, with the air ambulance service moving across the north, these air strips are indeed a needed facility.

The question of the use of fourth class mail is something I am sure we will be discussing before the estimates are completed. I know the chairman of the cost-of-living study will be trying to find out what the new crown corporation is going to do with regard to fourth class mail deliveries in the north. It seems there are a large number of products being moved now, a tremendous number, and that is a godsend. I hope and pray --

Mr. Stokes: Why don't you thank me?

Hon. Mr. Bernier: I will. I am trying to do that right now.

It is an excellent program and certainly the member for Lake Nipigon has to be complimented for stirring the pot and encouraging a lot of communities, as I have done in my area, to use fourth class mail. A lot of them were not aware of it. It is something I have some nervousness about because I am sure the crown corporation will be looking at that, but they will hear from me if they do.

Mr. Stokes: Michael is our friend.

Hon. Mr. Bernier: Michael is our friend, yes. I will certainly make it known if they tamper with that program.

I want to thank the member for Rainy River and the member for Lake Nipigon with respect to The Atikokan Story. As we are all aware it was the lead ministry concept here that took the sting out of the problems in Atikokan. I am confident that with the continued thrust we have and the desire to do something in these single resource communities we can find solutions to their problems, which are different in every way. Certainly the problems of Pickle Lake will be different than those of Atikokan or Manitouwadge. I hope the time will never come when we have to address those problems.

The community of Wawa is similar to Atikokan. I have already met with them on at least two occasions to discuss what will happen to Wawa 20 years down the road. I admire that kind of thinking. We are sitting down with them and trying to work out a strategy; at least we are discussing it. That is most important because the real success of Atikokan was the people themselves. If you read The Atikokan Story they did not have a doom and gloom attitude; they did not cry wolf; they were very positive about their future and they said so. They did not discourage investment and I admire the tenacity, guts and courage of the people of Atikokan. I am sure the same thing will happen to other nonrenewable resource communities in the north.

Mr. Chairman: That concludes the summation remarks of the minister. Now I am at the committee's whim. Are we going to be moving into votes?

Mr. T. P. Reid: Resign.

Mr. Chairman: Maybe sooner than expected.

Mr. Martel: There are a few points I want to raise with the minister if I could before I leave. One deals with a Department of Regional Economic Expansion grant or part of it. I am growing increasingly upset with what is coming out of the federal government and particularly the minister responsible, the federal member for Nickel Belt. Three times she has had a story in the Sudbury Star indicating it is Ontario that is holding up the funding for that development.

Let me just give you some background. This industrial park happens to be in the town of Valley East. You will recall that about a year ago this ministry, after four or five years of negotiations, finally agreed to put up $400,000 worth of funding as their one third share of the development or the services for that industrial park. The federal minister had previously said if the province put its money up for the project she had hers and the regional municipality of Sudbury would have to put up the difference.

I subsequently followed this through and asked the provincial minister in June if the province had committed its money, and he indicated he was standing by his commitment. He said he had the money clear for that project and he did not have to cut back from other sources of funding to meet the commitment he made last October.

Interestingly enough the federal minister is not happy with our minister because she cannot come up with her $400,000. I understand she wants the cutback of the funding from a DREE agreement in Nipissing. If she cannot get the provincial minister to agree then she cannot come up with her $400,000. In other words, the minister would have to withdraw his $400,000 from that agreement and she would then have her $400,000. It would appear that is the only way she can do it.

She is a real battler. On three occasions, the latest last Friday evening, the federal minister blamed the province. The provincial minister has his money and he has not been prepared to respond. I find it a little surprising that poor Judy Erola cannot come up with her $400,000, and she keeps dumping on him. He is the one who is continually in difficulty. Valley East went ahead with its project, installed the sewers and water in the industrial park, and now they will have to borrow to pay until Judy can come up with her money.

I quote: "Erola insisted the money was there but because of the provincial refusal to release it the federal government would come up with a new source for the $400,000." Even at this time she maintains it is the provincial minister's fault. I have seen some of the correspondence. As early as last January, the minister indicated to her he had this fund available. I want to know when the funding will be forthcoming. This lady, who has had three stories in the local newspaper in the last four months, continues to kick the minister in the head and he does not respond.

I phoned the provincial ministry this past summer when these stories started to come out that it was Ontario's fault the funding was not there and encouraged them to respond. It is time the minister responded and laid the blame where it belongs. If it is at the federal level -- I have every reason to believe it is -- that should be stated categorically. It is time we stopped fooling around. That municipality is now being forced to pay interest on money it had to borrow to pay the contractors who did the work.

Before the minister responds, I have one other item I want to speak to with respect to Ontario North Now. I have not been as gleeful about Ontario North Now as the minister has. I went down to see it two years in a row. It did not excite me, as a northerner, very much. Too many posters. We can send pictures of what is in the north to southern Ontario but it does not do much to enhance northern Ontario.

I have a proposal for the minister for at least one type of display. I have a neighbour who goes by the name of Whitepine Thompson. He has probably the largest collection of both moose antlers and deer antlers in the world. He has some 80 sets of various moose antlers. For example, he has one where the moose are locked in combat; in other words, the antlers are together and, as you know, sometimes when they get into that sort of fight they cannot break loose and consequently they die. He has a set of such antlers, which are mounted, locked in combat.

He has very large ones, some with as many as 26 or 28 points and one with 38 points. The minister, being from the north, understands what we are talking about when we talk about 38 points. That is a very large set of antlers. He has some that are three or four feet across.

If one wants to have some sort of display that indicates the hunting potential in the north, a display that is going to give people some incentive to come, one displays that kind of thing. I might say as well that he has a large collection of deer antlers, which he has had at the Canadian National Exhibition, by the way. They were displayed at the CNE a number of years ago, and one commentator wrote that this was a tremendous display, long overdue and truly Canadian.

He has a collection of seven black wolves, which are mounted: the head of dog wolf, large and good; the head of a female dog wolf, somewhat smaller; and two heads of pups. That sort of display would serve a lot better purpose than many of the posters we saw.

I ask the minister if someone on his staff -- and I will send him this material across the floor with Mr. Thompson's address and phone number -- could see if there is potential for a display such as this at Ontario North Now next year, because it would give something much more concrete than just a pictorial presentation of the north.

I might suggest to the minister at the same time that if he is looking for displays, he might get in touch with the carver in Sudbury who did all the carving with respect to underground mining and who is becoming world renowned as he does this carving. Laurentian University has a good many of his carvings on display, and they are so true to life that they are just a magnificent collection.

Mr. Stokes: You have made your point.

Mr. Martel: My friend the member for Lake Nipigon says I have made my point. I just add that this is the second opportunity.

Mr. Stokes: I am convinced.

Mr. Martel: He is convinced; and if he is convinced, then the minister should be too.

Let me conclude with one final comment. The minister said great things are happening in the north, and he talked about Elliot Lake. I might ask him where the rapid transit system is that the Premier (Mr. Davis) promised in 1978 would run from Sudbury to Elliot Lake to move the workers who were laid off at National Steel in Elliot Lake to get them to work in the mines. Will the minister tell me what stage we have reached in the development of that railway, which was promised and suggested by none other than the Premier?

Hon. Mr. Bernier: Mr. Chairman, I appreciate the member's contribution and his very sincere questions as well as his real concern about the Valley East industrial park. We have exchanged correspondence; he has spoken to me on a number of occasions about this project, which has been a comedy from our point of view as it relates to the involvement of the federal government.

To start with, our involvement and our discussions -- and we do have a lot of discussions with people in the federal Department of Regional Economic Expansion -- are usually with the federal minister responsible for DREE, Mr. Pierre de Bané. I think that is one of the problems.

I want to tell the honourable member very clearly that when we were approached to develop an industrial park in Valley East, we looked at it very carefully with the officials of the Ministry of Industry and Tourism. We felt it had merit. But we also felt that because of the commitment -- and I think it was an election campaign commitment -- there was something in the wind in the Sudbury area. The local member felt there could be some involvement by the federal authorities.

We took up that challenge, and I think we confirmed in writing to the mayor of Valley East that if he could find the federal funding for one third of the cost and the municipality was prepared to put up one third of the cost, we in the provincial government, particularly the Ministry of Northern Affairs, were prepared to put up our third, which was $400,000.

12:10 p.m.

We earmarked those funds, and they are in the estimates of this ministry's budget this year. The funds are there, and we are prepared to flow those funds. We were prepared to flow those funds six months ago. I went to Ottawa on at least two occasions, once with my colleague the Provincial Secretary for Resources Development (Mr. Ramsay), and we met, not with the federal DREE minister, but with the Minister of State (Mines), who had taken a very active interest and said she had been given the responsibility of negotiating this assistance to Valley East. She was prepared to recommend that the one third of federal funds should come from the North Bay agreement.

I wish the member for Nipissing (Mr. Harris) were here, as I am sure he recalls the problems I had -- the problems we had, because the Treasurer (Mr. F. S. Miller) joined me -- in getting that major agreement signed for North Bay. We wanted a $14-million agreement, which would have tidied up all the requirements of North Bay. But because of the insistence of the federal North Bay member, Jean-Jacques Blais, we settled for a $10-million package. Obviously we were $4 million short right off the bat.

In our experience, right across the north in all these DREE agreements, even though we do have a 15 per cent contingency fund, we always overrun. We all know the costs of doing things in the north now, with inflation and everything that goes with it; so we have never come in under budget. In no way were we going to jeopardize anything that happened in North Bay because of what I think was a political commitment to Valley East. We had our funds, and we made it known. In fact, I confirmed our position in writing to the Minister of State (Mines), that we could not jeopardize the North Bay agreement to that amount and piggyback those dollars for Valley East, and that we insisted new funds be found from within. This has been the problem right along.

To say the province is not prepared to live up to its commitment is entirely wrong. I am prepared to issue the cheque from the Ministry of Northern Affairs tomorrow morning. I really am. That would put the fat in the fire, because then the DREE agreement would be down the drain. How would they flow the money to the municipality of Valley East? Valley East would be the loser, because they could not flow it directly to them for that industrial park. It has to be through a provincial agreement we have with the municipality.

We have said: "Look, we are prepared to flow the money. We have the money right here." That is our position as strongly as I can make it. I understand the work has already been completed and the contracts are waiting to be paid. I say to the member, tell the mayor from Valley East that the money is in the Ministry of Northern Affairs. It is sitting here on my desk waiting to be flowed.

Mr. Martel: I will take the cheque home with me.

Hon. Mr. Bernier: Well, it is there.

Mr. Chairman: Now that the --

Hon. Mr. Bernier: Mr. Chairman, if I may just continue for one moment, the member brought up a very interesting suggestion, that we should consider the world's largest collection of moose antlers for our Ontario North Now pavilion at Ontario Place.

I am pleased to tell the member that our northern affairs co-ordinator, Jim Kozlich, has been in touch with this gentleman from White Pine. They are working on a plan. There is some discussion already under way. I am hopeful we can comply with the member's request next year. It is very exciting, no question about it, and I look forward to seeing the display myself.

I think that was about all. Was there anything else?

Mr. Martel: What about the rapid transit railway from Sudbury?

Hon. Mr. Bernier: I am told that our ministry, along with the Ontario Northland Transportation Commission, did a study on the Elliot Lake-Sudbury run. Unfortunately, the study proved that it would be uneconomical.

Mr. Martel: The Premier did not hesitate to promise it during the layoffs.

Mr. Chairman: It is my understanding, now that the member for Rainy River has allowed the member for Sudbury East the opportunity to say a few words, that we will be moving into specific vote items. Am I right?

Mr. T. P. Reid: If I had known what he was going to say, I would not have let him.

I wonder, pursuing my habit of trying to mess up the estimates by asking questions about money, if we could understand that when we are dealing with vote 701 or 702, we could ask about any item in the votes? Is that all right?

Mr. Chairman: Agreed.

Mr. T. P. Reid: Among other things, I would like to know what the special warrant for $775,000 was for. I would also appreciate it if the minister would break down the main office expenditures of $1.5 million; how many people are there?

I am going to get to analysis and planning, but I would also like to know what the $596,000 for information services is for. Is it for all the bumf the ministry puts out and all the posters with "The Honourable Leo Bernier, Saviour of the North" written on them and that sort of thing? Why are we spending that kind of money on information services? How many people are involved in that?

I would like to spend some time on the analysis and planning section, and I would like to warn Mr. Herridge and company under the gallery that I would like to know how many people are in that group. I would like to have the list, which the minister promised me last year and which I never did receive, of the actual studies that were being undertaken under this vote. I wonder if the minister has them with him, since I asked for them last week when we started the estimates.

Hon. Mr. Bernier: Mr. Chairman, the honourable member asked for a breakdown on the $1.5 million for ministry administration. I will give a breakdown of that $1.5 million.

Mr. T. P. Reid: I just want to know how many people. I have got the various categories. I also want to know what the transfer payment of $64,000 is for, under that first vote.

Hon. Mr. Bernier: The main office consists of a total staff of 21. That's the salary aspect of it. There is a staff of three in the minister's office, three in the deputy minister's office, three in the assistant deputy minister's office for the northeast, three in the assistant deputy minister's office for the northwest, two in the executive director's office and seven in administration and support services, for a total of 21 people.

Mr. T. P. Reid: Does that includes the Kenora, Sault Ste. Marie and North Bay offices?

Hon. Mr. Bernier: Just the assistant deputy ministers, yes.

12:20 p.m.

Mr. T. P. Reid: Can the minister tell us what the special warrant is that did not apply in the last few years? What is the $775,000 for?

Hon. Mr. Bernier: I am told the special warrant was something we had to use during the election writ period. The House was not in session, and our estimates had not been dealt with; they were dealt with by Management Board of Cabinet by special warrant.

Mr. T. P. Reid: I am not quite sure I understand. Was this special warrant for funds over and above the estimates that were approved last year?

Mr. Stokes: Yes. I signed it.

Mr. T. P. Reid: As I understand, it was not because the election was on. It was for estimates that were not approved by the House.

Hon. Mr. Bernier: That is right. The estimates had not been approved by the House.

Mr. T. P. Reid: What did it cover?

Hon. Mr. Bernier: Part of the total estimates of the ministry.

Mr. T. P. Reid: What did we spend $775,000 extra on to get you re-elected?

Hon. Mr. Bernier: The first three months of operation of this year were included in that. The general operation and administration of the ministry is included in that figure.

Mr T. P. Reid: I will put it as plainly as I can. Was the $775,000, over and above the estimates that were approved, a one-shot item? In other words, what was the $775,000 spent on? Was it simply to get us over the election period? Will it appear in the estimates again next year under main office or whatever? Is the minister telling me that he can run his ministry on $775,000 for a 42-day period? Maybe I should ask the former Speaker, the member for Lake Nipigon. He obviously knows more about the ministry than the minister does.

Mr. Stokes: If the House had been in session, Mr. Chairman, the minister would have brought in supplementary estimates, because he did not have enough money to keep going for the period in question. It was not possible for him to bring in supplementary estimates; so special warrants were used as they were for many ministries. I signed them.

Mr. T. P. Reid: It was purely for administrative things. It was not a new program that evolved.

Hon. Mr. Bernier: If the honourable member will look at the figure closely, he will see it covers main office, analysis and planning, information services and salaries, right clean through. The $775,000 for the period the member for Lake Nipigon referred to is subtracted from that figure. If the member will just look at it, he will see it is subtracted and not added. That is what special warrants are for.

Mr. T. P. Reid: I want to spend some time on the analysis and planning section of the vote which the estimates indicate have dropped, not from the actual spent but from the 1981-82 estimate of $1,094,000. We do not know what the actual was as yet; however, that is what was budgeted. This year under analysis and planning there is a decrease, and the minister is asking for $952,000 in analysis and planning.

Can the minister explain the decrease? Does this mean fewer people? Does it mean less focus on this aspect of the minister's activities? For the benefit of my friend and myself, I hope he has a list of those areas where they are doing analysis and planning.

Mr. Stokes: Get Andy under the gallery.

Mr. T. P. Reid: I see Andy Morpurgo, director of financial and program planning, under the gallery. I would not ask Andy myself, because we would be here all day, but I am sure if the minister were to ask Andy for a list of what he has been doing, perhaps we could get that and see where the focus and priorities are under this vote.

While we are waiting for that to be forthcoming, I would like to say some general words about what concerns me about this whole process. The Minister of Northern Affairs impressed me once in my 14 years in this House; that was when he was just a common, ordinary person like the rest of us. He was making a speech in the House about the problems northerners face, and he was talking about the aboriginal people in particular.

On that occasion he said there were so many studies, so many ministries and so many civil servants involved in northern programs who were doing studies, policies and analysis that the people who were supposed to receive all this largess from the various levels of government were utterly confused about what was going on and who to go to to get some direction and make application or whatever it was that was needed.

None of that has changed. Not only has it not changed, but it is even more confusing today. I have been going through the estimates of the Ministry of Natural Resources, I have been going through the estimates of the Provincial Secretariat for Resources Development and we are doing the estimates of the Ministry of Northern Affairs. We have been through this before, and I will not go through it all over again. But obviously the jurisdictions overlap: one has jurisdiction over a piece of this; another has a piece of that. My friend the member for Lake Nipigon covered the waterfront the other day trying to get a handle on who is ultimately responsible for some of these matters.

It is a cliché to say that we in the north have been studied to death. Almost half the northern boreal forest would still be standing there if we had not cut it down to provide paper and newsprint to do all these bloody studies. The question is and the bottom line is: Has it really improved the situation in northern Ontario? The people in Manitouwadge and the people in Atikokan do not think it has helped them materially at all, I can assure you. It is frustrating, and one wonders if it is a purposeful policy of the government to study all these things to death.

Let me give an example. We have the west Patricia land-use study; I get all these bulletins and stuff and, quite frankly, I just do not have time to go through it all. We have the Royal Commission on the Northern Environment, which is doing the same thing except that, thank God in a way, we have not heard from them at all. I have heard Mr. Fahlgren speak two or three times, and he does not like the member for Lake Nipigon. I do not think he likes me either. He spends a great deal of his time talking about his critics, but that is neither here nor there.

We have all these land-use studies. We have the Royal Commission on the Northern Environment. We even have the federal government. Mention was made of the Design for Development, and we all went through the agony of childbirth on that. As a matter of fact, the gestation period was like that of an elephant. It seems that I spent every weekend of my life at Quetico Centre for years. We have all this stuff and more reports, more reports and more reports.

We have The Atikokan Story, and I hope the minister is going to address himself in a little more detail to that. I think it is an excellent report. I would like the minister to deal at some point with the recommendations that were forthcoming from The Atikokan Story. Whether it should be in this vote or under economic development I am not sure, because it really deals with economic decline rather than with economic development.

The people in Atikokan as well as myself and others were really upset when -- what is the name of the mine just north of Ear Falls that is closing down?

Mr. Stokes: South Bay Mines.

Mr. T. P. Reid: South Bay Mines? The minister had the nerve to send out a press release, saying, "The closing of this mine will give us a rare opportunity to study the decline of a community, and I am sure we will learn valuable things from that."

12:30 p.m.

Mr. Stokes: They are holding a post-mortem.

Mr. T. P. Reid: Yes. Atikokan had been down for two years by this time, or better.

Mr. Stokes: Can you think of anything more exciting?

Mr. T. P. Reid: Perhaps there is a touch of necrophilia about the minister; I don't know. But that is not the point. The point is that among other studies we got was The Atikokan Story, with which I do not agree entirely, but I think overall it is an excellent study. There are something like 15 recommendations the provincial government could deal with. The minister has yet to respond to them.

I suppose the point I am trying to make out of all these studies in relation to this ministry is that we are still ad hocking everything in terms of northern Ontario, we are still dealing with a situation here and a situation there, and there is still no overall direction provided by this ministry and this minister, who takes great pride in saying: "We are sensitive to the needs of the north. We are the lead ministry in all this and, by God, we are telling everybody else what they should or should not do in terms of northern Ontario."

I am not quite as consumed by the excitement and satisfaction the minister indicated earlier. We read in the paper just recently about the layoffs in Kenora and other pulp and paper areas. We are reading daily or hearing daily about the mines, a nonrenewable resource. We are worried. People in the north are finally becoming afraid of what is going on in northern Ontario, because the press has finally tumbled to the fact that there is a story there; it is a bad story, and the press loves bad stories.

I do not know whether the minister and his staff happened to see The Fifth Estate on CBC on Tuesday night, I believe. I was not enamoured of that program. I gave them a lot of information they did not use; I even offered to appear, live or otherwise, on the program. But the gist of it was that we are running out of trees, our renewable resource. We cannot do much perhaps about the iron ore running out in Atikokan but, by God, we can and should be doing something about regrowing and regenerating our forests.

I was going through the library the other day, looking again at the plethora of studies on the forests of Canada and of Ontario in particular. I was looking at the old forest unit study of 1969. Mr. Herridge will remember that well. It should come back to haunt this government. There was one interesting title that I would like to claim for my own in there that really struck me, particularly in terms of the fact that metal reserves are a finite resource and the forestry industry could be infinite if we looked after it. The title of that one periodical or book was Forestry -- The Green Gold. My God, that is what we have, and yet we are wasting it.

Mr. Stokes: We are mining that.

Mr. T. P. Reid: We are mining that just like we are mining high-grade gold. That is exactly what we are doing. In my 15 years here, one of my biggest regrets is not seeing the government move on this issue. I want to know from the minister what input he is having on all this. Forestry is our biggest industry. We will be talking about economic development. Maybe I should save it for there.

Let me just leave this for now and ask, on the subject of analysis and planning, what analysis and planning has the ministry done on two topics in particular: (1) the present and future growth or health of the forest industry in the north and (2) one-industry communities in northern Ontario?

I ask the minister where the studies are on one-industry towns, other than the Atikokan study, which was not commissioned by the Ministry of Northern Affairs but by the Municipal Advisory Committee, and the minister will take credit for that because he has a finger in it as well. Where are the studies on one-industry towns and what we can do with them?

I think we are all mature and reasonable enough to know we are going to have some winners and losers. We are not going to be able to maintain each and every small community in northern Ontario. But at the very least we should have some kind of program, something that is understood, some kind of guideline so that when the crunch comes, when we are in that position, there is something out there. Then the community can say: "We know that the provincial government will do something to help us with municipal taxes once a large part of the tax base is eroded. We know certain guarantees will be given in terms of basic municipal services. We know that between the provincial and federal government, there will be some kind of mobility grant or Canada Manpower will be in here or whatever."

We ad hocked our way through Atikokan. I, like everybody else, have to take some of the blame. We really did not have any kind of program that was understood and acknowledged at the provincial and federal levels. I think that, to a large extent, the federal government abdicated any responsibility it had. I do not think it is good enough or fair enough to the people who have spent their lives, or a good part of them, in these communities to suddenly find the resource gone, sometimes because of this government's mismanagement. They are sitting there with the largest investment in their lives, a home, but no job and no prospects.

I would like to hear, particularly in terms of number two, analysis and planning, what the ministry has done in those two areas. I would like to know how many people are working in that area, what we are spending $952,000 on and what we are getting in terms of solid information in that regard.

Hon. Mr. Bernier: Mr. Chairman, if I may respond to the honourable member, I get a little bit confused when I hear the member for Rainy River talk at some length about the number of studies we do right across the government. Of course, he separates that into various ministries. Then to wind up his remarks, he asks for two more studies, one on the future growth of the forest industry and another one on the --

Mr. T. P. Reid: Because they are the important ones.

Hon. Mr. Bernier: Studies are a way of life in government; there is no question about that. I look back on our own involvement, the three members involved in the debates, and I look back to Design for Development. I went to some length to outline what came out of Design for Development. Sure, the gestation period was lengthy; the local involvement was significant. In our lifetime, participatory democracy is the thing; everybody wants input, everybody wants to be in on the act.

As an example, the member for Lake Nipigon, my colleagues and I went up to Big Trout Lake about a year ago, and the Kayahna Group insisted they wanted a study on energy substitution in Big Trout Lake. We never left until they had a commitment that the study would be undertaken by themselves. Does my friend recall that? They wanted a study; there was no question about it.

I know how the honourable member feels; I have shared his frustration on some occasions. I look at the peat studies, I look at the study we have going on now and the research work at Lakehead University on the utilization of wood waste, but these things have to be studied; that is where one starts if one is going to get a new policy or a new program. There is no end of these studies that can and will be undertaken.

I am sure the member for Rainy River is interested in the study we are doing with regard to the quality of poplar in the Fort Frances area. Will that support a small industry in the Fort Frances area? He is interested in that study. But we have to look at it, count the trees, do a study and use some of that paper.

12:40 p.m.

Mr. T. P. Reid: Yes, you did a peat study, and nothing's going to come out of that.

Hon. Mr. Bernier: I am not so sure of that. I will not stand here and say nothing will come out of the peat study. We are into a whole new resources field. It is an exciting one. The way economics are moving with regard to the cost of energy today, I am one who strongly feels peat is a hidden gold mine for us in the north. There is no question about it; it will start to flow.

The Atikokan Story is another study, a very complimentary one. One can talk about studies on single-resource communities, but there is nothing more effective than what we did in Atikokan. There are studies still going on, and they will go on. In the north, we all have to accept the fact that the Pickle Lakes have nothing in common with Atikokan. They are both mining communities, but they are geographically and completely different. Then there is South Bay Mines, to which the member made reference and commented about a study we did with regard to the Selection Trust gold mine at South Bay. The situation in South Bay was entirely different from what occurred at Atikokan.

Atikokan is a community of 6,000 people, a built-up community with all the infrastructure of a community one could see. Has the member been to South Bay? South Bay is a totally temporary community. Everything is on a temporary basis. The company did not even own the land; it was all on a lease basis. It was told when it built that facility that when the oil reserves were gone and the lease expired, it must leave it clean and neat.

The company has mothballed that community. Everything is on a portable basis; the living accommodations are all portable. When the company finds a place for the headframe and the other mining facilities in another area of northwestern Ontario, it will be left clean. Mattabi Mines is a complete mining operation; that is all that is there. Maybe we could gain something for future operations. We will show them The Atikokan Story. We will show them the South Bay mining operation story. They are part of our studies, and there will always be ongoing studies.

Getting back to the single-industry communities, the DREE people have undertaken a very extensive Canada-wide study on single-resource communities and the problems facing them, particularly relating to nonrenewable resources. There is a committee under the cabinet committee on resources development of which we are a part, together with the Ministry of Natural Resources and the Ministry of Municipal Affairs and Housing, that is looking at that report.

There is no easy solution to the problems of single-resource communities. I live in one; I know what the problems are. It is all right to sit and condemn the government for not having a pat answer, and saying when Manitouwadge closes down or when something happens in Terrace Bay, we should pull out a blueprint and say: "This is what happened, A, B, C, one, two, three. You do this and you do that." It does not happen that way.

I strongly believe the lead ministry concept is the answer. I hope the government sees fit to make us the lead ministry in the Pickle Lake area should something happen. We all know how tender and sensitive that matter is. In Manitouwadge, if something happened, we would like to be the lead ministry.

We have had a tremendous amount of success with that thrust in Atikokan. With the resources we have, both human and financial, I do not think we could do it ourselves. In Atikokan, we put up the money for the industrial mall. We did not go to the Ministry of Industry and Tourism. We knew we would have difficulties leaning on that ministry because its priorities are different from ours.

Atikokan has worked exceptionally well, and that is the thrust I would like to see. My staff share my view that this is the route we would like to see taken. Each community will be dealt with differently and separately.

We talked about the amounts. Our budget for services, which include studies, has been reduced from $246,000 in 1980-81 to $46,000 in 1981-82.

Those are studies done outside the ministry, where we actually contract them. We are having a reduction of $200,000 in that particular field.

Mr. T. P. Reid: Could we have a list of how many staff?

Hon. Mr. Bernier: You already have a list.

Mr. T. P. Reid: No. That was just for the head office.

Hon. Mr. Bernier: No. There are 22 staff, including five secretaries.

Mr. T. P. Reid: In analysis and planning?

Hon. Mr. Bernier: In analysis and planning.

Mr. T. P. Reid: Are there any reports we can have that they have worked on or are working on?

Hon. Mr. Bernier: Yes, we can give the member a list of those.

Mr. T. P. Reid: I have one other question about the transfer payments of $64,000. Who is in receipt of that largess?

Hon. Mr. Bernier: I am sure you will support that, Mr. Chairman, because that is the transfer payments to UCANO East and UCANO West.

Mr. Chairman: The member for Lake Nipigon indicated he had some inquiries on this vote. Just to refresh all members' memories and, more important, for those students who are in observance, we are doing the estimates of the Ministry of Northern Affairs; in other words, how the minister is spending the taxpayers' money in the north.

Mr. T. P. Reid: He didn't answer my question on information services.

Mr. Stokes: Mr. Chairman, the minister did not address himself to one of the problems in the north that I think is much more basic than almost anything else we have been talking about in Ontario and certainly in these estimates.

During my presentation last week, I mentioned the lack of any real continuity with regard to planned economic development. We mentioned, and the minister never even referred to, the old economic development councils we had that worked so well in northwestern Ontario. Then we got to the Design for Development for northwestern Ontario, and the minister said: "Well, that has served its usefulness. It has run for 10 years."

The minister said 80 per cent of those recommendations had been fulfilled. I take exception to that comment. I think we have been treading water with regard to Design for Development, because I do not think the minister can point to any new jobs as a result of any initiatives taken under Design for Development. I think we did some job replacement, but I do not think the minister can point to the number of jobs that were undertaken to be provided either in the mining industry or in the forest products industry. As a matter of fact, I think if the minister had a statistical analysis, he would see that we are just treading water.

There have been considerable funds spent, both by the federal government and by the provincial government, to assist the pulp and paper industry to upgrade antiquated plants. They say they would walk away from them if they had to carry the brunt of cleaning up the environment, of having to become more efficient and of having to utilize a different species of tree to produce wood pulp and linerboard. All we are really doing is insuring the jobs that exist.

As a matter of fact, the kind of dollars that are going to be spent in Boise Cascade in Kenora will result in a decrease of something in the neighbourhood of 350 to 450 jobs. That is a major industry of northwestern Ontario where we are dedicating federal and provincial tax dollars and there will be a net loss in the number of jobs. For any community in northern Ontario, if there is a reduction of 300 to 400 jobs, that has a very profound and lasting effect on the economy of any of those communities. I just take exception to the statement made by the minister that Design for Development has served a very useful purpose.

12:50 p.m.

I want to know what the minister meant when he said the Design for Development for northwestern Ontario had really served its purpose, which would lead me to believe that something is going to be supplanted or replaced by something else. I realize that is what we have to do. But I do not know what that something else is, because there is nothing the minister has said in his opening comments or in response to our opening comments to indicate there was any overall plan he was aware of. And he is the lead minister in all of northern Ontario, the minister more responsible for co-ordination in the north than any other minister.

I heard about nothing to take the place of Design for Development. He knows we have spent in excess of $6 million to have the Royal Commission on the Northern Environment running around the north handing out dollars to anybody who wants to do a study or a survey. I am told they have research material coming out of their ears.

The present commissioner said it has taken him almost this length of time to digest the kind of material, the statistical analysis, the input he has as a result of his 42 or 45 visits to a variety of communities throughout the north. The minister never even mentioned that commission, which was specifically commissioned to study those things within its terms of reference and to report back to this government.

I think the last time he reported back, he said he was having difficulty getting a handle on the kinds of issues and the details he should be addressing himself to because he did not have any policy direction from this government. I would have thought it would have been the other way around, with the minister anxiously awaiting some direction or feedback from the Royal Commission on the Northern Environment, so he could implement the policy directions that he and his commission indicate in the work they are supposed to be doing on our behalf.

The minister knows this process has never happened. I am wondering why, since he is probably aware of the inability of that commissioner and that commission to address itself to the job it was assigned to. I know we should not be sending good money after bad, but I do not think we can just drop the handles and say, "Well, that wasn't a very good way to go, because we have too much money invested in the thing." Somehow the minister, his ministry and his government have to salvage something out of that, because they have built up the hopes and aspirations of far too many people in the north to let that go.

If the minister is convinced he is not going to get any sense of future direction from that commission, I think he has a responsibility to get up here and say that now. If he has confidence in that commission to do the job it was assigned to do, I would like to hear how he proposes to do it with the present personnel.

I am not out on a personal vendetta to try to get somebody. I have never operated that way. I do not think unkindly of Ed Fahlgren -- I have known the fellow for years -- but I do not think he has the ability to carry out the mandate assigned to him.

The minister need not take my word for it. Let him talk to the people who have heard the commissioner in Fort Frances, Atikokan and Thunder Bay. The last time I heard him was in Atikokan. His staff had prepared a 30-minute written speech for him. He got up and made a few off-the-cuff remarks and said, "You people have worked very hard over this weekend, talking about the social and economic issues for all of northwestern Ontario, and I am not going to bore you with this 30-minute prepared speech." He threw it aside, got up and spoke off the cuff for 45 minutes and said absolutely nothing.

That is the reality of it. I do not say this in an unkind way, but we have a lot of dough invested in this whole exercise. An awful lot of people in the north are hoping for great things from the Royal Commission on the Northern Environment. The minister knows what is going on with regard to the West Patricia land-use plan. He knows what is going on with regard to the strategic land-use plan for all of northwestern Ontario. He knows what is going on with regard to Detour Lake. He knows what is going on with the millions of dollars we are spending for new access roads. He knows about the studies on wild rice. He knows all of these things, but the Royal Commission on the Northern Environment does not know what is going on.

As a matter of fact, I am told that the Royal Commission on the Northern Environment has a submission before Management Board of Cabinet to provide more funds for more studies -- and I can name them chapter and verse -- the kinds of studies that are working in opposition to the strategic land-use plan. If the minister wants to talk to the Minister of Natural Resources (Mr. Pope), if he has not already done so, he will learn they have been doing everything humanly possible to get the people in the Treaty 9 area to respond to the West Patricia land-use plan by saying: "We want you to be part of it all. We want to consult with you. We are available. Here is all the documentation. If you are interested in having some input, please talk to us or invite us in so we can explain what we are all about."

Does the minister know what the Royal Commission on the Northern Environment is doing? They now have an application before Management Board of Cabinet to provide funds for that group so they can conduct their own land-use planning program. The minister knows that, and I think he has a responsibility to the people in the north who are interested in getting on with the job of planning. He has a responsibility to the taxpayers of the province. As a matter of fact, he has a responsibility to his own cabinet colleagues to apprise them of what is going on before those funds are allocated for a dual purpose.

That process is already going on in northwestern Ontario right now at a time when the minister is likely to appropriate further funds that are going to be counterproductive to anything that is going on there in the north. If Mr. Fahlgren does not understand that, then the minister should understand it, because I have talked to the Minister of Natural Resources, I have talked to people in the field and I have talked to people in the commission.

This problem is not going to go away; it is just going to get worse and worse. I think the minister has more responsibility than any of the 8.5 million other people in the province to do something about it, and I have not heard anything since we started these estimates that would give me the assurance he is at least prepared to address that very basic problem.

The House adjourned at 1 p.m.