Legislative Assembly of Ontario

ESTIMATES, MINISTRY OF AGRICULTURE AND FOOD (CONTINUED)

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The House resumed at 8 p.m.

House in committee of supply.

ESTIMATES, MINISTRY OF AGRICULTURE AND FOOD (CONTINUED)

Mr. Chairman: If memory serves me correctly, on Friday we concluded with the opening statement of the Minister of Agriculture and Food (Mr. Timbrell). I will now recognize the member for Huron-Middlesex.

Mr. Kerrio: Now you are going to hear it

Mr. Ruston: Now you are going to hear from the soil.

Mr. Riddell: Mr. Chairman, I am a little surprised that the House is not full of members and the galleries not full of people, because I cannot think of anything more important than the production of food in this province.

Mr. Nixon: There is one of them actually leaving.

Mr. Riddell: However, as time progresses maybe we will see more members wandering into the Legislature; particularly if they are tuned into the intercom system and hear the remarks that are being made, not only by the member for Huron-Middlesex, but by the member for Welland-Thorold (Mr. Swart).

I am really looking forward to the contribution of the member for Welland-Thorold as the new agriculture critic for the New Democratic Party. He is a gentleman for whom I have a great deal of respect because he is one of the hardworking members in this Legislature.

Mr. Nixon: Right.

Mr. Riddell: I know that he is going to fill the shoes of his predecessor, the former member for York South, who had to relinquish his seat to the new leader of his party.

Mr. Ruston: Even if there are no NDP members here but him.

Mr. Riddell: I do want to congratulate the minister on his first attempt to explain the operations and programs of his ministry. I would not have thought it would take some two hours and more to give us a detailed outline of the workings of his ministry.

Hon. Mr. Timbrell: It did not. It took an hour and 50 minutes.

Mr. Riddell: I was somewhat amused last Friday when, at about 10 minutes to one, I rose in my place and asked the Chairman if he could possibly see one of the clock so that the members who were sitting in the House would have an opportunity to go to that great Canadian unity event, the Grey Cup luncheon, sponsored by this government. I thought the minister would render his approval to that kind of a decision. But he jumped up and said, "Mr. Chairman, I had hoped you might give me an extension of time so I could complete my remarks."

I wondered why he was doing that. In the many times I had sat in the Legislature, I had never before heard a minister ask for an extension of time so that he could complete his opening statement. I came to the conclusion that he wanted his remarks to be contained in one copy of Hansard; and chances are he will send out that Hansard containing two hours of comments to the many potential delegates throughout the province --

Mr. Ruston: He had 10 of them down there in Windsor.

Mr. Riddell: -- who will read his comments and feel that he is doing a tremendous job for the farmers of this province. So they will come to the leadership convention, whenever it is called, and in all probability the minister will be able to garner a great deal of their support.

I cannot think of any other reason for him wanting his comments to be contained in one copy of Hansard. If the minister is sending copies of Hansard throughout the province, how many does he intend to send out? And I want to know how much he anticipates this garnering of support will cost the taxpayers of Ontario?

I am congratulating the minister on his opening statement; I do not know that I am congratulating him because I think he has done such wonderful work for the farmers of Ontario. I question that. I know he is going around the province and opening up processing plants, and he is talking about devoting more money to processing plants and things of that nature; but we will have a better assessment of his operations as the Minister of Agriculture and Food when the spring comes and the farmers apply for their operating capital, and when they are told that they will not be able to get it because they have not been able to show a financial statement in the last two years which shows any kind of a profit.

They are not going to be able to do it with the prices of commodities where they are and the input costs, including the high interest rates, where they are. They cannot do it. Before I came to Toronto this morning, I had to see a bank manager because he is calling a loan on a farmer who has 38 per cent equity in his business. The only indebtedness he has to the bank is $25,000 in operating capital and the bank called his note.

That is just one of many examples of the tough line the bankers are taking with the farmers. We have seen but the tip of the iceberg yet. I will have more to say about --

Mr. Kerrio: The minister is ignoring your remarks. He is not interested in the plight of the farmers.

Mr. Riddell: He seems to be busy signing something. I was amused when I was attending a function here not too long ago. The young chap who was sitting beside me said, "Mr. Riddell, do you know Mr. Timbrell?" I said that I guess I should, since he is the Minister of Agriculture and Food and I am the critic of that ministry. The young chap replied, "Well, when I graduated from a certain college not too long ago, I received a very nice letter of congratulations from the minister."

I have to assume that the minister is doing his job. We know that he is not only going to try to do a good job as the Minister of Agriculture and Food, but he is also paving the way for greater heights. Therefore, I would have to assume -- he can tell me if I am right or wrong -- that he has sent a letter out to every graduate of every college that comes under his jurisdiction.

There is only one reason for that kind of expenditure. He and I both know what the reason is. I guess that is what is known as the game of politics, our great democratic system. I would hark back to the words of Winston Churchill when he said, "Democracy is far from perfect, but it is the best system that has been devised to the present time."

When the minister responds to my remarks, he can give me his estimate of what it costs to send the letters to all the graduates of the agricultural colleges throughout the province. Dear knows how many other letters and what other propaganda he is sending out for only one reason. If it was in his riding, I could understand it. When it is across the whole of Ontario, he is doing it for only one reason.

8:10 p.m.

As a matter of fact, the very fact that he requested of the Premier (Mr. Davis) the Ministry of Agriculture and Food portfolio had to tell me one thing. Up to that time, the minister had not been the least bit interested in agriculture. He was doing a job in Health; he was doing a job in Energy; but he went up to his great friend, the Premier -- and I understand the two of them are pretty close -- and said, "Billy, I would dearly love to get the Agriculture and Food portfolio." The Premier probably said, "Well, Dennis, why are you so interested in it?" The minister said: "Well, Mr. Davis, some time you are probably going to think of retirement. There is going to be a leadership convention and I would dearly love to be involved in that convention."

My understanding is that the Premier sent a message to this minister, to the current Minister of Health (Mr. Grossman), to the Minister of Intergovernmental Affairs (Mr. Wells) and to whoever else is interested in running, and he made the message clear, as I understand it, that he has no intention of stepping down so members should not waste their time trying to convince people of their leadership aspirations.

Let me get on now. A substantial part of Ontario's farm industry is in serious economic difficulty, and in particular the beginning and low-equity farmers. Ontario farm bankruptcies have increased dramatically from 64 in 1979, to 122 in 1980, to 140 in 1981, and at present they stand at 145 for the first 10 months of this year.

These numbers represent only those farmers who were forced over the edge in formal bankruptcy proceedings; they do not include the larger number of farmers who got out of the business while they still had some equity remaining. The Ontario Federation of Agriculture has calculated this ratio at 10 to one. I wonder how close the federation is when it says that for every farm bankruptcy there are 10 other farmers who sold before they reached that stage, who sold when they still had some equity left in the business.

The agricultural industry outlook for this year is cause for concern and perhaps even alarm, with a forecast that net farm incomes will decline 23.5 per cent -- again, the greatest decline in Canada. Our farmers need financial subsidy programs because they are more vulnerable to fluctuating interest rates than most other business groups in our society. Farm operations have a low revenue-to-asset ratio, which means that on the one hand they must invest and borrow heavily for their farm operations, but on the other hand they receive low returns for the commodities produced. Chase Econometrics Canada has calculated that an increase of one percentage point in the prime interest rate reduces the total net income of farmers by $50 million to $60 million.

This government lacks any real commitment to the agricultural industry in the province. In fact, agricultural budgetary expenditures have declined to 1.1 per cent of total budgetary expenditures, down from 1.3 per cent last year and 1.83 per cent in 1971. That figure includes the property tax rebates. These never should be charged; the minister has announced changes and I am going to have more to say about that a little later. It includes the crop insurance premiums, which are paid back by the federal government. It includes the tile drainage loans, which are paid back by the farmers; granted there is some subsidy in their interest rates.

If you were to take all of those programs out of the provincial allocation to agriculture, you would find that this province's share of the total provincial budget for agriculture amounts to a little over 0.5 per cent.

This is hopelessly inadequate for an industry which employs one in five people in Ontario. In fact, this year's budget has allocated $14 million less for agriculture than last year.

During the consideration of last year's estimates, I detailed the long-term credit programs offered by the other provinces in Canada to their farmers and I tried to impress upon the minister that Ontario was the only province that lacked any such programs for its farmers.

I would like to quote a current report of Farm Credit Corp. Canada concerning this matter. It states, "Ontario agriculture relies almost entirely on credit provided by the federal government" -- let us give the federal government some credit over there -- "and private lending institutions and is the only province that does not offer a long-term credit program."

At the same time, Quebec has extended $347.3 million in credit to its farmers for 1981-82. In Alberta, the amount loaned to its farmers was $388.5 million. Ontario is the second lowest province in Canada in terms of total, long-term government credit extended, which is entirely provided by the federal government. Yet our farmers in Ontario are expected to compete with the farmers in these other jurisdictions.

While the minister continues to blame Ottawa for the problems our farmers are experiencing, more of our producers continue to be forced out of business.

I agree with the minister when he states our farmers need a more meaningful farm product price stabilization program but, until an agreement is reached with Ottawa, Ontario farmers need more assistance than that which will be rendered by the Ontario farm adjustment assistance program.

We continue to be concerned by the fact that this government has not seen fit to introduce a young farmer financial aid program even though such a program was promised to our farmers on March 9 of this year, in the throne speech, and again on May 13, in the budget speech.

In August of this year, while speaking to farmers in Leamington, the minister stated, and I want you to listen to this --

Mr. Eakins: We are listening.

Mr. Riddell: This is in his speech to the farmers in Leamington. The minister stated: "It is hard to contemplate how a young person could consider getting into farming unless he has a deal with his family to ease in gradually. A beginning farmer is looking at a minimum of $250,000 to establish and probably $300,000 to $400,000. I hope it" -- what he is talking about is the program -- "will be no more than three or four months away."

That is the young farmers' credit program which was promised. Another one of the Premier's promises that have gone by the wayside after he got elected.

I cannot help but think about that little ditty that was used in the last election. It went something like, "Come on Ontario, help keep the promise, Davis can do it." He sure did it. He sure did it to the farmers and to many others in Ontario. I really criticize you people for using a ditty that is almost like some of these -- what are these groups called, that bend the minds of people?

Mr. Elston: Cults.

Mr. Riddell: Cults. That is the very process the Premier used in the last election. He used a ditty he knew was going to bend the minds of the people. I think that is a crying shame.

Mr. Sheppard: The dairy industry is okay.

Mr. Riddell: The farm organizations have responded --

Mr. Sheppard: The dairy industry is okay.

Mr. Riddell: We have a second Bob Eaton sitting back there.

I can recall when my former colleague, the late Jimmy Bullbrook, was making a speech and Bob Eaton started to interject. Jimmy Bullbrook stopped and said, "Mr. Speaker, would you see that somebody escorts that woman out of the hall?" Bob Eaton has never gone very far because of that either. He has gone as far as he is going to go. I maintain he was given a job as Minister without Portfolio because he is not going to last very much longer around here and the Premier wanted to improve his pension a wee bit.

8:20 p.m.

The farm organizations have responded. The minister has received the comments of the Ontario Federation of Agriculture, the Christian Farmers Association and the National Farmers Union. Yet we are now told this aid for young farmers is on hold indefinitely. I would again point out to the minister that all the other provinces have a program to help their beginning farmers. Quebec introduced an interest subsidy program in September 1982 providing long-term loans for farmers 40 years of age and under who are establishing a farm. The Quebec government pays the interest costs on the first $50,000 for five years on loans under the tandem program which involves --

Mr. Shymko: What is the deficit in Quebec?

Mr. Riddell: -- the Quebec Farm Credit Act and the federal Farm Credit Act --

Mr. Shymko: What is the provincial deficit in Quebec?

Mr. Riddell: I tell the member opposite, at least Quebec has the concerns of the farmers at heart. Perhaps the member has heard the saying before, "As goes agriculture, so goes the nation." In Quebec they realize that and they are prepared to help the farming industry there.

Mr. Shymko: They are in the hole in Quebec.

Mr. Riddell: Maybe they are, but their farmers are outcompeting us. They are outcompeting us by virtue of the fact that this government has no commitment to the farming industry in this province.

In Manitoba, farmers under 40 years of age are eligible for a four percentage point rebate on the first $50,000 loan for five years. Interest rates on guaranteed loans are one per cent above the chartered bank's prime rate.

In Alberta, the government provides a variety of loans, including direct loan programs aimed at beginning farmers and family farms. One feature of the direct farm loan program is its five-year fixed interest rate, which is at 12 per cent, with a three percentage point reduction of interest for the first five years for those producers who cannot obtain financing elsewhere and whose net worth is less than $225,000.

The only answer from this government to the financial problems facing our farmers has been the Ontario farm adjustment assistance program. I know the minister is going to get up and he is going to say, "Riddell, you should not be talking about that program because the majority of the money has gone into your riding." I am not going to dispute that. We have had the lion's share of the money, but also probably there have been more farm bankruptcies in north Huron and Bruce and Grey counties than in any other part of the province.

Mr. Sheppard: How many in Quebec?

Mr. Riddell: I am speaking for the farmers of Ontario. I do not have to speak for the farmers of Quebec.

While the farm adjustment assistance program is better than nothing, it is far from adequate in addressing the situation. A resolution passed last week at the Ontario Federation of Agriculture annual meeting called on the government not only to extend this program, but also to improve it. The Ontario Federation of Agriculture has stated:

"It makes no sense whatsoever for the government to guarantee a new line of credit to a producer without making the new loan eligible for interest subsidy. Frankly, we find it perplexing that the government would choose to deny a subsidy on the deferred interest and the new line of credit after having determined that a producer needs interest assistance. But as it is presently constituted it resembles a half-completed bridge over which the hard-pressed farmer is invited to take a walk."

This is the point I have been trying to make in my questions to the minister in the Legislature. I have been asking him if he is prepared to make changes in the OFAAP and allow the same interest subsidy on the new line of credit as well as on the deferred interest portion of that program. I am not asking any more than the Ontario Federation of Agriculture asked for at their convention.

It is little wonder that, after a year of the Ontario farm adjustment assistance program, less than half of the $60 million allotted to the program has been committed for the five per cent interest rebate option.

While the minister goes around the province praising the fact that his program has helped some 3,000 farmers, he fails to mention that this figure represents less than four per cent of our farm population. With the large declines that are forecast in net income and with the low commodity prices that threaten many cash-crop farmers this year, this program will not be an adequate solution to the economic problems facing our farmers.

If the minister thought he had problems last year with the red meat producers sitting on his doorstep, he just has to wait. From now until spring seeding next year he is going to have numerous cash-crop farmers sitting on his doorstep.

I find it totally unacceptable that this government will argue that there is no money to provide meaningful assistance programs to prevent the food producers of this province from going bankrupt, yet it has no trouble finding $650 million to buy a small share in an oil company for investment in resources outside the province. Its priorities are mixed up, to say the least.

What this province critically lacks is a clearly defined strategy for agriculture. The minister may recall the report of the action committee to him stated that the provincial government should implement a strategy for agriculture, yet no visible long-term agricultural policy exists at present. This has resulted in the introduction of ad hoc, short-term support programs. While such programs may contribute to the short-term survival of farmers, they do nothing to maintain the economic viability of our agricultural industry or to ensure a sense of security for the future.

I think the minister is on the right track by pushing for a tripartite stabilization program, but I want to know what he is prepared to put in place if the federal Minister of Agriculture states he is not interested in a tripartite stabilization program.

The minister and I both know that the federal minister is a strong proponent of marketing boards. I think he would like to see the pork producers and the beef producers enter into a national supply management program. If he holds out for that, there is a possibility he may well turn down any participation in a tripartite stabilization program. If he does turn it down, does the minister have anything in place to help the farmers of Ontario?

Mr. Shymko: How about Eugene Whelan?

Mr. Riddell: How about him?

Mr. Shymko: Does he have any plans?

Mr. Riddell: I thought I just went over that. The present overriding need is for low-interest loans for consolidation of debts and operating loans.

The minister has mentioned the benefits of his ministry's tile drainage loan program and the fact that they are allocating $6 million more for tile drainage loans this year. While we can fully appreciate the benefits of this program, we are very concerned that this investment is still about 40 per cent less than the demand last year. At most, the additional funds will aid only some 700 farmers, who may receive only half of their maximum loan limit.

Moreover, much of the benefit of this program has been negated by an increase in debenture loan rates from eight per cent to 10 per cent and by the fact that only 60 per cent of the total drainage work will be covered, down from 75 per cent last year. This means the rest of the funds will have to be borrowed from the banks at normal bank interest rates.

8:30 p.m.

When the principal and interest repayments from farmers for previous loans are considered, the new money actually designated for this program may amount to only $10 million to $12 million and not the $36 million that the minister would have us believe. We in this party believe that the government should provide up to $50 million a year for low-interest tile drainage loans and that these should cover 75 per cent of the cost of the drainage work.

The disappearance of our best food-producing agricultural land is a major concern, one that has consistently been ignored by this government. Ontario is already short of high-quality food land and is a major importer of food.

Just 15 years ago, Ontario farmers produced more beef, pork, poultry, eggs, dairy products and vegetables than we could eat. Sad to say, this is no longer the case. During the past seven years, Ontario's food imports have increased by 126 per cent to $2.3 billion. Replaceable imports that could have been grown in Ontario amount to $1.25 billion.

In 1980, imports of fruits and vegetables into Ontario totalled about $595.8 million. The processed fruit and vegetable industry in Ontario has declined seriously. Two outstanding examples that were identified by the government's own consultative task force on the processed fruit and vegetable industry in Ontario are canned peaches, of which imports rose from $4.7 million in 1960 to $18.4 million in 1978, and canned whole tomatoes, imports of which went from $2.4 million in 1960 to $13.2 million in 1978. These are two products that we could grow extremely well in Ontario, and yet our imports have increased dramatically.

In the tender fruit industry in Ontario between 1960 and 1978, 17 out of 20 fruit processing plants closed and an additional 25 processing plants discontinued production. Today only one fruit canner remains.

The 1981 census for agriculture confirmed the ongoing loss of farm land in Ontario, showing about 12,274 fewer farms than in 1971 and more than one million acres less of farm land. Eastern Ontario saw a 16.2 per cent decrease in census farms, central Ontario an 11.5 per cent decrease, western Ontario an 11.3 per cent decrease, southern Ontario a 14.3 per cent decrease, northern Ontario a 4.7 per cent decrease, and the province a 12.9 per cent decrease; a decrease in every one of those jurisdictions.

The government's own report states that during the next two decades Ontario's food production will need to grow by the equivalent of 1.1 million acres of new food production capacity if we are to maintain current levels of self-sufficiency while meeting future demands, yet our prime agricultural land continues to go out of production at an alarming rate with the silent approval of the Minister of Agriculture and Food.

The truth of the matter is that the government is not and never has been very concerned about the destruction of our food-producing areas. The ministry's food land guidelines, which came in before the present minister was appointed to this portfolio, are meaningless.

Last year during hearings concerning the agricultural land in Mississauga, which is referred to as the hole in the doughnut, the Ontario Municipal Board found that these guidelines were so ambiguously worded that they are practically useless. The OMB stated:

"It is commonly said of the food land guidelines that they are a government policy. There is no doubt in my mind that this is so. Having said that, however, it is necessary to note that some of the material in the guidelines is of such a nature that it cannot be described as policy as that word is defined in the Concise Oxford Dictionary, namely, 'a course or general plan of action adopted by government.' If the guidelines are read keeping in mind this definition of policy, it can be seen that many of the statements are not plans of action but merely explanatory."

The chairman then found there was nothing in the guidelines which explained why he should stop Mississauga from allowing this precious farm land, estimated as being one five hundredths of all the first-class farm land in Ontario, to be covered with asphalt and concrete.

When the minister responds, I would like him to comment on his participation in this annexation of farm land in Mississauga to take it out of agriculture.

Hon. Mr. Timbrell: That was before my time, before I got here.

Mr. Riddell: Twelve thousand acres of good agricultural land were approved for urban development in that case. Last year we had the case of the Vaughan lands, and now we have the case of the Brampton lands.

Mr. Nixon: Let's go over the Vaughan lands again.

Mr. Riddell: We spent a good deal of estimates time last year on the Vaughan lands, and there is still something funny about that whole deal which we were not able to draw out of the minister and his staff, by virtue of the fact that the Minister of Agriculture and Food refused to allow anybody to go up and take an oath to present us with the truthful information.

I guess that again is the type of democracy Churchill referred to as being far from perfect, the fact that the minister would not allow his staff to take an oath so they could tell us the truth. As a matter of fact, the truth was never told.

Mr. McNeil: That's not right and you know it.

Mr. Riddell: It certainly is right.

Mr. McNeil: It is not. You know it.

Mr. Riddell: It certainly is.

Mr. McNeil: I was there.

Mr. Riddell: Maybe the member was. He went there, saw the land and referred to it as a hog's back. I went there and I would like him to tell me what a hog's back is. I talked to the farmers around there. They told me --

Mr. McNeil: You went out and looked at it in the spring of the year.

Mr. Riddell: The farmers told me the kind of yield they were getting off that land, and they could not understand why the government would ever say it was not suitable for farming.

Mr. McNeil: What kind of yields were they getting off that land?

Mr. Riddell: I am not saying the member for Elgin (Mr. McNeil) was not telling the truth. I am saying there were some people who knew what the truth of the whole matter was, but the then Minister of Agriculture and Food refused to have them come up and take an oath so they could respond to our questions.

Mr. McNeil: You have impugned the whole ministry.

Mr. Boudria: Why are you guys so defensive about this?

Mr. Riddell: As the minister is aware, the Brampton official plan has included more than 7,000 acres of food land within its urban boundary for urban development. This is alarming --

Mr. McNeil: You are a smart young man. You have all the answers. You have been here a year and a half. You are a real bright young man.

Mr. Riddell: Who is he talking to, you or me?

Mr. Boudria: I think he is talking to me. He is really upset.

Mr. Riddell: I can understand him being upset because sometimes the truth hurts. We know that.

Mr. McNeil: You should know.

Mr. Sheppard: Yes, you should know.

Mr. Chairman: Come on, come on.

Mr. Riddell: The Brampton official plan has included more than 7,000 acres of food land within its urban boundary for urban development. This is alarming, as 81.5 per cent of Brampton's land is class 1 and is located in a favourable climate.

As the minister is aware, land losses are not acre-for-acre equivalent, as class 1 land produces 100 per cent more food per acre than class 4 land, with the same energy input.

8:40 p.m.

We listen to the minister talking about devoting money to develop more land in eastern and northern Ontario, knowing full well that we are never going to end up with class 1 land. So why would we do away with our class 1 land here to get less efficient and less productive land in eastern and northern Ontario? We do not understand it. Sure, the heat units are an important factor here, but --

Mr. Treleaven: Bob, did he say the same about the Hydro corridor?

Mr. Riddell: Listen, before this is all over, my friend is going to hear from my colleague about the Hydro corridors. This is one time when I have to give the Deputy Minister of Agriculture and Food some credit. I happened to be at the hearing in Stratford when he walked in and said, "We in the Ministry of Agriculture and Food are very much against a corridor going through Huron county, which is the best land we have in Ontario."

Interjections.

Mr. Riddell: Well, this is what he was alluding to, so I feel that maybe he had something to do with changing the route of that corridor. I must say that my people in Huron county are very happy about this, but there are some who are not quite as happy and we are going to hear from those people before these estimates are over.

Perhaps what is even more alarming in this case is the lack of any response from the ministry. Brampton council first passed the official plan that is now before the Minister of Municipal Affairs and Housing (Mr. Bennett) in August 1980, yet we are still awaiting the comments of the minister; or is the minister trying to save his ministry's staff from embarrassment since they stated at that time that the minister had no comments to make on this proposal?

Mr. Nixon: He's going to send Ronnie out to have a look at it.

Mr. Riddell: Yes. I would dearly love the parliamentary assistant to go out and have a look at this land in Brampton, because I want to know whether he is going to classify it as being a hog's back; and if he does, then I certainly do not know what the definition of "hog's back" is. Anyway, we will await further comment from the parliamentary assistant.

The minister's commitment to preserving farm land is a sham in the light of the Brampton official plan. When the ministry's food land guidelines were released in December 1978, we in the Liberal Party stated that these guidelines would not save Ontario's farm land unless officially adopted, that the guidelines were no more than idle gestures and that they would give the deceptive appearance of a policy in place but provide no method or mechanism to ensure they would be followed. The action by Brampton council exemplifies that the guidelines are indeed meaningless.

No one is protecting the prime agricultural land in this province. As the Christian Farmers Association has stated, "Food production is a provincial responsibility, not a municipal one, and Ontario's consumers will not have guaranteed food supplies in the future until the province acts on its responsibility."

Another area of major concern to us in this party is the whole question of the conflict between agricultural land and mineral aggregates. The Ministry of Natural Resources is in the process of having areas for mineral extraction designated in municipal official plans. It is forcing municipalities to incorporate these plans under the threat of not having their official plans approved by the Ministry of Municipal Affairs and Housing.

The government's policy paper on mineral aggregate resource planning, which was prepared in September 1980, stated that all other ministries would have due regard to that statement when making a policy decision that affected mineral aggregate resource lands. This policy statement made no mention of agricultural land and no doubt will supersede the food land guidelines.

The Ministry of Agriculture and Food had no part in the preparation of that policy, which was prepared by the ministries of Natural Resources, Municipal Affairs and Housing and Transportation and Communications. I am really shocked to think that the Ministry of Agriculture and Food was not involved in those plans, particularly when they deal with good agricultural lands.

The Ministry of Natural Resources has identified at least 500,000 acres of land as a source of aggregate in the province, including 6,000 acres of Niagara fruit land. This area already has been depleted by urban growth to 53,000 acres, or less than two thirds of its original size.

What is the minister doing to ensure that agricultural land does not merely become a holding zone for aggregate extraction? All the indications are that the government plans to open farm land to gravel extraction.

The government has done very little to expand agricultural production in this province. The minister no doubt will recall the Premier's 1981 election promise to upgrade a million acres of northern and eastern Ontario land into high-quality farm land. Needless to say, that is another promise that has not gone very far. The acreage improvement fund promised for this purpose has yet to see the light of day.

On August 27, 1982, the Minister of Agriculture and Food announced that his ministry was developing an agricultural strategy for northern Ontario. This is yet another in the long line of studies announced concerning agricultural marketing in the north.

He will recall that in 1977, as a result of the lack of government commitment to northern Ontario agriculture, his own colleague, the present Minister of Natural Resources (Mr. Pope), introduced a bill to establish a food terminal in northern Ontario. The Minister of Agriculture and Food at that time supported the principle of the bill and initiated a marketing study, along with the Ministry of Northern Affairs, to examine the agricultural potential in the north. Such a study was to have gone from a steering committee to a committee of cabinet. As yet, no report has ever been released.

In May 1980, a further study was commissioned by the government concerning agricultural marketing in northern Ontario. Nothing has come of such a study, if indeed it ever got off the ground.

On another front, we are very disturbed over recent proposals that have been circulated by the Ministry of Natural Resources regarding revisions to the Mining Act. I raised this as a question in the Legislature. The Minister of Natural Resources whispered to the Minister of Agriculture and Food that I was completely wrong, that they never intended to charge an acreage tax on land for mining purposes; yet if he were to look at the last report that came out on this, there is nothing in that report that excludes agricultural land. The Minister of Natural Resources is going from the original report that came out a few years ago, but there has been a supplementary to that report and, by all indications, the proposal is to charge an acreage tax.

One of the changes that is envisaged is the extension of an acreage tax for mining rights on privately held lands. This proposal would apply to the vast majority of the 15 million acres of agricultural land in the province.

Another aspect to this proposal included a possible reversion to the crown of mining rights of persons who are neither willing nor prepared to explore, develop or produce the mineral resources on their lands. We believe this proposal would be totally unacceptable to all farmers and must be rejected by the government.

When I raised this matter in the Legislature, the minister stated in his reply that my information was incorrect. Perhaps the minister will clarify the position of the government on this matter. Perhaps he can also clarify the matter for the Ontario Federation of Agriculture, which stated in a brief to the minister, and I quote once again:

"The proposals under current discussion are again suggesting that an acreage tax apply to all lands regardless of title. To further suggest that private mineral rights may revert to the crown if development of such rights does not take place, even if the tax is paid, is totally without merit. In our view, this is expropriation without compensation." That is the end of the quote from the Ontario Federation of Agriculture.

8:50 p.m.

The Conservation Council of Ontario has stated: "The suggestion that the mineral rights on private lands should revert to the crown if an acreage tax is not paid is an attempt to gain access to land which is not now available for exploration whether or not it bears minerals. Aside from the conservation impact of such a measure, it does seem to present some fairly serious infringements on the rights of the land owner to manage his land as he desires."

If the minister thinks I am wrong in my facts in questioning him in the Legislature, why does he think officers of the OFA and the CCO are so concerned about those proposals?

Another area of major concern to me is the lack of any responsibility by this ministry over matters that occur beyond the farm gate. I am sure we are going to hear more comments on this matter from the member for Welland-Thorold (Mr. Swart). He is a good food critic, there is no doubt about that, but I caution him before he stands up and starts to talk about the expensive food that people are buying in this province, he has to realize that the food basket is probably as cheap in this province as it is in any country in the world. I would hope that in trying to reduce food prices, he is not going to lower the price of the product that the farmer gets before it passes beyond the farm gate.

I would remind the minister that it was in 1963 that the Ministry of Agriculture and Food changed its title to include food. For years, the Ontario Food Council was supposed to have assumed responsibility for the food industry. However, that body was totally ineffective and was abolished. The responsibility for monitoring food trade practices was to have been transferred to the Ministry of Consumer and Commercial Relations.

Our inquiries have established, however, that no one has accepted that responsibility and the government still remains ignorant of many of the trade practices used by the food industry. The large supermarket chains engage in practices which continue to make them large profits at the expense of not only the food processors but the independent processors and manufacturers as well. Profit figures for the supermarket chains show that they made sizeable 1981 earnings, even taking into account the year-end price war, while the farmers who produced their commodities saw slack prices and rising debts.

As the president of the OFA stated this year at the annual convention, and once again I quote: "The gap between the farm-gate price of food and the retail price keeps getting wider and wider. A can of tomatoes cost 94 cents in the store last month. The farmer's share was 16 cents. Three years ago, the farmer's share was three cents less than it is today. But the retail price was 29 cents less. A pound of fresh chicken was $1.38 in stores last month. The price to the farmer on an eviscerated basis was 66 cents." The examples go on and on.

Moreover, the power of the chains in this province continues to increase at the expense of the independent. Last year, their share of the grocery sales in Ontario went to 75.1 per cent of the market, compared to about 48 per cent just 15 years ago. At the beginning of this year, we saw the establishment in the food industry of yet another buying group designed to squeeze more discounts and allowances from food suppliers.

Dominion Stores Ltd. and Steinberg Inc. have now combined their buying clout through the formation of a buying group known as Volume One. This major concentration of buying power among the major chains through buying groups will decrease competition and will eventually lead to higher food costs to consumers and a reduction in food suppliers and independent retailers.

In the United States, the five major food chains share only 26 per cent of the grocery sales due to the Robinson-Patman Act, which the American government passed to prohibit unfair trading practices. Ruth Jackson of the Consumers' Association of Canada has stated, and I quote: "The formation of buying groups is definitely going to decrease competition. We just cannot see that supermarkets united in a buying group are going to compete aggressively."

The head of the Canadian Federation of Retail Grocers has stated: "Small grocery stores are also endangered by the formation of buying groups such as Volume One and Foodwide. The small grocers, who say they will have to charge higher prices because they cannot get the same volume discounts as large chains, believe that discounts should be outlawed in Canada as they are in the United States. Such large buying groups create unfair competition for small stores."

The Ontario Federation of Agriculture is also concerned that the purchasing policies of the supermarket are reducing not only the number of food retailers but also the number of food and food products suppliers. On October 27, 1980, the OFA wrote to the Premier and sent a copy of the letter to the then Minister of Agriculture and Food, the member for Lambton (Mr. Henderson), concerning the Leach commission report on the food industry. The federation asked that the government refuse to accept the report, because it believed it was nothing more than a whitewash and totally unacceptable.

On November 26, 1980, the Premier responded to that letter, indicating that the conclusions and findings of the report would be studied by the government. Two years have gone by and we have yet to hear any response. I would ask the minister, what is the government's response to the OFA request that the Leach report not be accepted and that action be taken in those areas it specified? Action by this government is urgently required in this area and I hope the government will introduce legislation, similar to that I have introduced on two occasions in the past, which would prohibit unfair food industry trade practices in Ontario.

Another item upon which I would like to comment, and it is one about which my colleagues and I have very serious reservations, is the recent attacks by the deputy minister on our marketing board system. It is really unfortunate that we are holding these estimates in the Legislature. I have always enjoyed having them in committee. I can understand the reason they are here, and I am not blaming anybody for bringing them into the House. I have always enjoyed the dialogue we are able to have in committee with the minister and his staff on matters of concern, but we are unable to do that here.

Members may think I am levelling an attack on the deputy minister when he cannot respond in kind. I have no other choice. I was not the one who insisted that the estimates come into the House; nor was the minister. It was an agreement reached by the House leaders and I can understand the reason. We have to get the work done. In all fairness to the Treasurer (Mr. F. S. Miller), we brought the estimates into the House.

I am going to have a few words to say about the deputy minister and if he wants to meet me some time outside the Legislature, I am quite prepared to meet him. I believe the deputy minister's public statements about quota sharing do absolutely nothing but erode confidence in the system. When the deputy minister, in a very political way, puts forth the idea that Ontario could withdraw from the broiler and meat part of the marketing board system he is flying in the face of reality. We are able to operate that system because Canada is a member of the General Agreement on Tariffs and Trade. If Ontario producers followed Mr. Allan's advice and pulled out of the chicken agency, the agency would collapse and import restrictions would no longer apply.

9 p.m.

I would like to read from the editorial of the November issue of the Canada Poultryman to show the very serious concerns our farmers and our people in the chicken industry have about the comments made by the deputy minister. "Ontario's deputy minister of agriculture Mr. Duncan Allan recently told Ontario chicken producers that they should pull out of the Canadian Chicken Marketing Agency if they do not get a better quota allocation deal."

Mr. Sargent: Hear, hear.

Mr. Riddell: Was that Ronnie McNeil?

Mr. Sargent: Give it to them, Jack.

The Deputy Chairman: The member for Grey-Bruce (Mr. Sargent) should be a little bit more silent up in the gallery so we do not have to hear him.

Mr. Sargent: Give them hell, Jack.

Mr. Riddell: I am doing my best, Eddie.

"A complete report on Mr. Allan's speech appears on page 16 of this issue. Since it is unlikely that Mr. Allan is naive or dangerously misinformed about the consequences if Ontario would withdraw from the CCMA, it is clear that Mr. Allan is playing politics for the benefit of Ontario's quota allocations. To some extent this type of brinkmanship can be tolerated, but Ontario producers should make their minister aware that his advice could destroy the profitability and existence of family-run chicken farms. If Ontario producers followed the honourable minister's advice -- "

Hon. Mr. Timbrell: Mr. Chairman, on a point of order: Is the honourable member referring to remarks made by my deputy minister in his recent speech this fall? If he is, I would like to see where in that speech my deputy minister called for the withdrawal at any time by Ontario from that particular national plan.

Mr. Riddell: What I am referring to is an editorial --

Hon. Mr. Timbrell: With all due respect, the member may want to leave that and come back to it later in the estimates, because I do not believe in that speech my deputy minister did call for a withdrawal.

Mr. Riddell: Why would the editor write that article in the Canada Poultryman?

The Deputy Chairman: If the honourable member would hold on a second, I will recognize the minister and then yourself.

Hon. Mr. Timbrell: This is a committee. I am only asking, since the deputy minister cannot reply, that the member would perhaps delete that portion from his prepared text until later and reconsider. Perhaps he would like to check the speech, because I do not believe that any time in that recent speech did my deputy minister call for a withdrawal by Ontario from the national plan.

Mr. Riddell: Mr. Chairman, I would prefer to read the editorial, and I will send the comments the minister just made, along with any comments I make, to the editor and I will ask him to dispute the fact of whether the deputy minister said it or not. I cannot believe that if the deputy minister did not say it, an editorial would have been written and, furthermore, if it is so far from the truth, why did the deputy minister not sue the editor?

Hon. Mr. Timbrell: Do you believe everything you read?

Mr. Riddell: If it defamed my character the way this article does I would darned well be pursuing it, I will tell the minister that. I have not heard tell of the deputy minister pursuing the matter, so I have to believe that --

Hon. Mr. Timbrell: In other words, if it suits your purpose, use it; if not, do not. Is that right?

Mr. Riddell: Certainly I am going to use it. You cannot always have it your way.

Now let me continue. "It is clear that Mr. Allan is playing politics for the benefit of Ontario's quota allocations. To some extent this type of brinkmanship can be tolerated, but Ontario producers should make their minister aware that his advice could destroy the profitability and existence of family-run chicken farms. If Ontario producers followed Allan's advice and pulled out of the Canadian chicken agency the agency would collapse and import restrictions would no longer apply.

"In his speech, Mr. Allan rightly predicts" -- I ask the minister to note these three little words, "in his speech" -- "an ensuing chicken war that would result in financial hardship for many Canadian producers. Unless Mr. Allan has a subsidy plan worked out, he is very wrong when he tells Ontario producers that they would come out all right in the event of a chicken war.

"With import restrictions removed, American chicken would flood into central Canada first because it is closest to the major producing areas in the USA. Canadian surpluses would then cause depressed prices across Canada. The Ontario chicken board is making an effort to work within the agency instead of giving up, as Mr. Allan so eagerly advises.

"The Ontario Ministry of Agriculture and Food would likely find itself involved in an expensive subsidy program if the CCMA collapsed and imports were allowed free access to our markets. At a time when the Ontario government has implemented a much-needed restraint program, a subsidy program would not be welcomed by an overtaxed, underemployed electorate.

"Alternatively, producers would end up growing chicken for integrators on a contract basis at rates that would drive most broiler producers out of the business in a few years. The results would be that a few totally integrated companies would take care of all Canada's domestic chicken production with a high percentage of imported products keeping prices too low for individual producers to survive.

"The producers of Ontario and the rest of Canada, whose blood Mr. Allan is so eager to spill" -- those are awfully strong words. If I did not make that kind of comment and somebody was going around the country saying that I was trying to spill blood, I would be pursuing that to the nth degree, but to the best of my knowledge Mr. Allan has not done that. It indicates to me that they must have had a copy of his speech and they must have been quoting him almost verbatim in this article.

Hon. Mr. Timbrell: Or that he does not read the Canada Poultryman.

Mr. Riddell: If the deputy minister does not read some of the leading farm magazines, you had better he looking for some --

Hon. Mr. Timbrell: Do you consider that one of them?

Mr. Riddell: The Canada Poultryman? Oh, my goodness. The quote continues: ". . .whose blood Mr. Allan is so eager to spill, would find a way to repay anyone who treats sensitive industry issues with such a callous attitude. One can only hope that Ontario producers and their delegates see Mr. Allan's speech for what it really is, a purely political statement designed to intimidate the Ontario chicken board and the chicken producers in the rest of Canada." Those are pretty strong words if he did not have some facts to go by.

The minister has also been picking a real quarrel with the Canadian Chicken Marketing Agency about oversupply quotas and so on.

Hon. Mr. Timbrell: Do you disagree?

Mr. Riddell: Who is the chap who is arguing with you in the chicken agency? What is his name?

Mr. McNeil: Don't you know?

Mr. Riddell: It has slipped me right now. Do any of you fellows know?

Mr. McKessock: Is it Johnson?

Mr. Riddell: Anyway, he says you are all wrong in your facts and figures. He said that Ontario is getting its fair share of the quota. I would like you to get up and use his figures and how he arrives at them, and then you give us your figures and how you arrive at them, so that I will be able to go back to the farmers in my riding and say, "Well, Timbrell was right. This other chap is wrong." I want to know who is right and who is wrong.

Are you putting up a fight on something that you are totally wrong on, or do you actually believe that we are falling far short of the quota which we should be getting based on our population and our production trends? Perhaps you will comment on that.

The last item which I would like to comment on, and an area of major concern to us in this party, is one which I have been pushing the government to take definite action on since 1978, that of nonresident foreign ownership of our agricultural land.

9:10 p.m.

I understand, Mr. Minister, that you had some previous knowledge that we were going to raise this either by way of a question in the Legislature, which we have done, or by way of comments in my opening remarks, because I understand this subject was a last-minute addition to your statement. It was something you were not going to touch on until you knew whether we were going to pursue it. That is the information I have and it could be wrong.

Hon. Mr. Timbrell: It is wrong. What is your source?

Mr. Riddell: I am not saying I am right all the time.

Hon. Mr. Timbrell: What is your source? It is wrong.

Mr. Riddell: We have some pretty good sources over here.

Hon. Mr. Timbrell: You would not still be there after 39 years if you did.

Mr. Conway: Tell us it will last for 1,000 years.

Mr. McNeil: The opposition will have to be stronger than it is now.

Mr. Riddell: Get your rubbers out, Ronnie, and get out in the field.

The Deputy Chairman: A little bit of order. The member for Huron-Middlesex has the floor.

Mr. Riddell: I would dearly love to comment on that statement, but I will not, Mr. Chairman.

Mr. Conway: In Peking they called the member for Elgin the vice-minister. He was a very big hit.

Mr. Riddell: It really bothers me to think that he is the parliamentary assistant to the Minister of Agriculture and Food yet they use other people. I really take offence at this because I have a lot of respect for the member for Elgin. If he is made parliamentary assistant to the minister I feel he is the one who should be filling in for the minister when he cannot attend functions.

I do not know who arranges it, but we see instead somebody like the member for Chatham-Kent (Mr. Watson) or maybe the member for Durham-York (Mr. Stevenson) or practically anybody else, get up to speak at a function and say, "I have to express the regrets of the minister that he is unable to be here but I am more than pleased to be here representing the minister as the parliamentary assistant." The member for Elgin is not given that opportunity and I do not know why. I think it is dirty pool, that is what I think.

Mr. Conway: They must know that Ronnie was a prominent Liberal before he entered --

Mr. Riddell: That could be, but the member for Elgin should not talk about a weak opposition, because I think the people over there are not treating him all that well.

On December 5, 1978, I asked the former Minister of Agriculture and Food if he was aware of the widespread and serious concern about block purchases by foreign investors of agricultural land in Ontario. I also asked if it was true that foreign interests were circumventing the land transfer tax by forming Ontario corporations, and whether he would undertake a survey of current foreign ownership of rural lands in Ontario and monitor all new land transfers.

The minister at that time indicated these purchases were insignificant and that no government action was necessary. It was very disturbing to note that the present minister has taken the same view. The fact of the matter is, no one knows how much land nonresident foreigners have bought or are buying; nor do we know the real consequences of such purchases.

In some townships in the province the amount of nonresident, foreign-owned land is very significant. I have been told it may amount to as much as 80 per cent of the productive farm land in certain townships. I believe most people would agree that large concentrations of nonresident owners in any one area can affect the whole social structure of a community.

These investments will accelerate the demise of the family farm unit. Many local farmers and beginning farmers are unable to compete with the prices which are being offered by foreign investors, who keep land prices artificially high. What this means is that the younger generation of potential farmers will be reduced to nothing more than tenant farmers.

Some farmers will say they do not mind renting land; some farmers have done nothing but rent land all their lives. However, most young people who aspire to farming hope they will be able to own farms some day.

I have two young people helping me in my farming operation who have gone through agricultural college and do a tremendous job of farming. If you want to come out, you will not see straighter rows of corn or better yields anywhere than those young lads are able to get from that land. Yet for a number of years these two boys have not been able to buy farms because they cannot compete with the price the foreign buyers are prepared to pay for this land. They just cannot make it work out with pencil and paper.

The former Minister of Agriculture and Food has argued that these nonresident owners cannot pick up this land and take it over to Germany or whatever country these investors come from, but the fact is that we have very little control over what they do with that land. Just as surely as I am standing here, once that land is sold to a nonresident investor, it will be like pulling teeth to get that land back for our own young people who dearly want to get into the farming business.

Two or three years ago, when I was in Germany on the select committee, I asked the Germans why they were so interested in investing in our land. They said, "For a couple of reasons. One reason is to hedge against inflation in this country, and the second is the hedge against creeping socialism." They said: "You know what is happening in Poland at the present time." It would not surprise them if the Russians went marching into Poland and right across Poland into Germany.

That was their fear: that the Russians would not stop in Poland but would go right across Germany. Believe me, the Germans knew that the best place to invest their money was in land in this country. That is the reason they are doing it. They are going to hold on to that land, and it is going to make it very difficult for our young people ever to acquire land they can call their own and land they want to farm and work to produce food for the people of this country.

Most of the concern over foreign ownership stems from the lack of knowledge about its extent, the source and nature of such amounts of ready cash, the long-term intent of foreign purchasers regarding the use of the land and the lack of any effective controls over these purchases.

I have listed numerous examples of these purchases in the Legislature in the past, but after two years of monitoring, the minister still is unsure of the extent of the problem. We still do not have a final report listing the degree of foreign ownership in Ontario townships, yet the minister assures us there is no problem.

Does the minister really know what is going on in connection with the foreign ownership of land? Has the minister ever seen an offer to purchase that was signed by the farmer and the foreign investor? If he has, he will have seen a clause in the offer to purchase that states that before the foreign investor will purchase the land, the farmer must incorporate, and they recommend that he form a numbered company.

Then the shares from that company are transferred to the foreign investor, thereby allowing him to escape from the land transfer tax and also enabling him to get by without registering his land under the new Registry Act because the numbered corporation happens to have an Ontario address.

That is what is going on, and the minister's report on the amount of land that has gone into foreign ownership is so far from accurate that it really should be scrapped. A study was done in Huron and Bruce counties; it came up with vast acreages of land that had been sold to foreign owners of which the government had no record whatsoever. That is why I say their report is far from accurate.

Mr. McKessock: In Grey county as well.

Mr. Riddell: In Grey county as well, my colleague tells me.

Somehow we are not reassured by the minister's statements, and we will have more to say on this subject later in the estimates.

I indicated that this was the last item I wanted to touch on, but there are two others I want to touch on very briefly. First of all the minister's announcement about the property tax rebate: I wonder if he understands that he is causing a lot of farmers with small holdings a considerable amount of grief because of his proposal to raise the gross revenue to $12,000. Does he realize that a farmer in, say, Grey or Bruce county, with 100 acres of land --

Mr. McKessock: As a matter of fact, all the counties down east and up north.

9:20 p.m.

Mr. Riddell: Any of those counties, even in Huron where they have 100 acres of land and may be producing 25 cows if they have a cow-calf operation. If each one of those cows raised a calf and that calf sold for $300, which is the case today, that farmer would not qualify for the rebate because he would not meet the minister's $12,000 gross revenue criterion.

What about the retiring farmer, the farmer who has decided to slow down a wee bit? He is not that interested in making his land produce to its maximum potential. Maybe he is quite content to raise a few cows and maybe a couple of sows or something of that nature. He is not going to be able to show a gross revenue of $12,000, yet he is going to be penalized by virtue of his small holding and the fact he is not an intensified producer on that land.

I think the minister had better give this some thought. I really think he does not fully understand the number of farmers who are not going to qualify.

These are full-time farmers; but the problem applies not only to them, but part-time farmers, young lads who have had to borrow a considerable amount of money to get started in the farming business and in order to meet their commitments have had to do some off-the-farm work. They are starting slowly and do not have all kinds of money to invest in 100 head of beef cattle or to get into the dairy business or anything like that. They are starting slowly. Yet these part-time farmers, these young people, are not going to qualify for the property tax rebate because they will not be able to show $12,000 gross revenue. The minister should figure it out for himself. To have 25 cows on 100 acres is not out of the way, is that not right?

Mr. McKessock: That is right.

Mr. Nixon: How much?

Mr. Riddell: I understand that 25 cows on 100 acres is quite a common thing in certain counties. There is also the case where there may be a poor farm with shallow land and top soil that is not very good, but it is still land that is being farmed. They are not going to get the yields the good farms are going to be able to produce, but they are still struggling on that farm and are still trying to produce to the best of their potential and to the best of the land's potential. Yet it may well be they are not able to show a gross revenue of $12,000. The minister is telling these people they are not going to qualify for the property tax rebate. He had better give that some thought before he raises the gross revenue from $5,000 up to $12,000.

Lastly, I want to mention briefly, although I intend to get into it in more detail during the estimates, the subject of the distribution of milk in Ontario, a matter I have drawn to the minister's attention through correspondence.

Many of the dairy people who rely on their businesses to sell milk are finding their areas are being infringed upon by the larger dairies which, as I understand it, are operating outside the Milk Act.

The Milk Act states who can distribute milk. I understand it makes no reference to agents or sub-agents. The larger dairies are even getting around this by saying to some of their own trucker employees, "Look, we are going to make you an agent," or, "We are going to make you a sub-agent and you distribute the milk." These people are going all over Ontario. They are going outside areas for which they are not even licensed to distribute this milk. What it is doing is to the detriment of these people who have operated within the spirit of the act -- they have been licensed, they know where they can distribute milk, and yet there seems to be no control over the larger dairies using agents and sub-agents to peddle the milk, or what I call bootleg the milk, here, there and all over the province.

This issue has now come to the fore and the minister had better devote some attention to it because there is an association of these independent -- what do they called that organization? The name escapes me now. They have formed an association and they will be approaching him about tightening up the Milk Act.

Mr. Eakins: Independent milk distributors.

Mr. Riddell: Independent milk distributors. All these distributors of milk will have to be licensed and they will have to live within the spirit of the act. Now, according to the information we have received, they are contravening the act.

My colleague the member for Victoria-Haliburton (Mr. Eakins) and I met the other day with the independent dairy distributors. We spent a good hour with them. They are going to document their case. I hope I will have it prior to that particular vote in the estimates. I want to get into that in more detail as well as the matter of public commercial vehicle licences for trucking milk which I drew to the minister's attention in a letter. I believe he told me this matter is at present being investigated.

With those comments, I am going to take my seat and I look forward to the minister's response on some of the concerns I have expressed on behalf of the Liberal Party in connection with the farming industry of Ontario.

Mr. Chairman: The member for Welland-Thorold.

[Applause]

Mr. Swart: Mr. Chairman, I presume the applause I may be getting from my colleagues on the right is more from the fact that this is the first time I am speaking on agricultural estimates than it is because they may agree with everything I am going to say.

Mr. Sargent: Do not give the same speech as last year.

Mr. Swart: At least one of the members does not even know that I was not agricultural critic last year and did not take part in the debate.

I rise to speak as agricultural critic with some mixed emotions, not about being the agricultural critic but about the value that often appears to be placed on the debate of the estimates. I agree wholeheartedly with the comments of the member for Huron-Middlesex (Mr. Riddell) that there is nothing more important than dealing with agricultural matters, but certainly there will be no reports in the press about the matters debated here this evening.

I doubt if even the minister -- and I did not see anything -- got any press about his 84-page leadoff statement. That is a situation that exists with regard to estimates. I guess I am also a little bit concerned about the fact we are holding them in the House. I realize the difficulty in getting them out to committee where the questions and answers can be a little more freewheeling than there are here. In spite of that, I am pleased to be here as the agricultural critic.

I want to congratulate the minister on his appointment as the Minister of Agriculture and Food. Was it last February he was appointed to that position?

9:30 p.m.

I would think that perhaps, on occasion, the comments that the members on your side of the House used to make about the former member for York South may haunt you a little bit. They used to call him the "asphalt farmer." That term was to some extent meant as a joke but it was derisive, too, when applied by the Conservative members to the former member for York South. Now they have their own asphalt farmer over there as minister.

I also want to pay tribute to my predecessor as agriculture critic for this party. Those of us who were at the Ontario Federation of Agriculture banquet will know that Donald MacDonald, the former member for York South, was awarded a plaque by the federation for his service to agriculture. I think all of us in this House will agree that was a distinct honour; and those of us who have sat in this House for a period of time will know that it was deserved. No one in this House became, over the years, more knowledgeable about agricultural problems and fears than Donald MacDonald. It is with some humility that I follow in his footsteps.

I want to say to the minister that I think he will perhaps bring a more analytical approach to agriculture than the two ministers who filled that portfolio previously. Also, I think he is much smoother than the two previous ministers of Agriculture and Food. He will be very adept at explaining away the government's shortcomings, which are many; he will do a good job for the government in that regard.

As an example I would point out his performance on the Ontario farm tax reduction program at the federation of agriculture banquet where he made the announcement. Of course, what he really did was to postpone any improvement for two years -- the member for Huron-Middlesex also mentioned this -- after the government had promised to introduce it this year. He postponed it for two years after the federation had written a letter stating that it wanted it now and wanted the $5,000 limit to remain. Not only did he postpone it for two years. but even for this year he raised the qualification figure from $5,000 to $8,000, which is a 60 per cent increase.

As the member for Huron-Middlesex said, that is going to prevent numbers of farmers in this province from getting the tax rebate because this year prices have gone down. I suppose the minister thought the announcement would be well accepted by the farm community, but I suggest that after some reflection on this, the farm community will indicate to the minister that it is not acceptable to them.

That is going to be the minister's forte, he is good at it; and with the government's agriculture policies, he has a big job to do to try to sell those policies to the farmers of this province.

However, I really think that the minister may do more for agriculture than the previous two ministers did. Again as the member for Huron-Middlesex said, there are many delegate votes out there among those farmers; and whereas the two previous ministers obviously had no aspirations, we suspect that this minister does have aspirations and wants to firm up those votes. So I think he is going to work at it.

His 84-page opening comments were a combination of his political aspirations and a rather forward-looking program for Ontario agriculture, on paper at least. It was of course a self-congratulatory document he presented here last Friday.

I notice he has been getting some help in this from the member for Elgin (Mr. McNeil) in the private member's resolution he had before the House about two weeks ago. Again, it was very self-congratulatory. There is also the resolution, which I guess we are going to have for discussion this week, from the member for Chatham-Kent (Mr. Watson). I suspect they are on the minister's team and are part of the group helping him get those delegate votes.

The minister will resolve a bit of the aggravation among the farmers, certainly in areas where things do not cost too much. His proposed programs may not materialize but they at least look good on paper. Perhaps they would be good if proceeded with in a meaningful way.

Mr. Conway: What do the delegates in Welland-Thorold think about this?

Mr. Swart: I am not sure I should mention it. In Welland-Thorold, in the last provincial election, only 17 per cent of the vote went to the Conservatives. There are not many delegates there. It is a bit more difficult to find them to get an expression of opinion from them.

The short-term and long-term planning proposals, and I am now being positive, in the minister's statement would cause one almost to think, on reading that document, that it was developed and written by a democratic socialist. He said foreign ownership of land was at one per cent and he is really concerned about that and thinks it deserves closer examination. He is going to strengthen his surveillance.

He talked about the program of import replacement; about producing a much larger volume of tomato paste; about import replacement on strawberries and about an economic plan for replacing those imports. He talked about a direction whereby whey would be converted to a useful product. He also laid plans, on paper at least, for a profitable peanut industry. He talked about storage facilities and about seeing that they be developed so we could be more self-sufficient.

In that document, he did not even come out in opposition to Canagrex. He did not say whether he was for it or against it. It was hopeful that he did not come out in opposition to it. That is the first ministry to propose and promote this degree of economic planning. It almost looks as though Ontario is going to determine the goals, to set the framework, to say that is the way it must be and then is going to tell private enterprise that it is going to work within that framework. That is the kind of thing we in this party believe in.

Has the minister cleared this with the Minister of Industry and Trade (Mr. Walker), especially this matter of foreign ownership? The minister expressed concern about the one per cent or what may be a bit more than that. It was only last week, when we were talking about Cadillac Fairview, that the Minister of Industry and Trade asked how anyone could object to bringing in $200 million worth of Arab money.

Has the minister cleared with the cabinet the objection to the foreign ownership of land and being concerned about one per cent? There is also the concern about the auto industry. The Minister of Industry and Trade thinks it is great to have foreign ownership of our auto industry. He has no objection whatsoever to that sort of thing. Nor does he seem to have any objection to our importing all our natural resource machinery.

I wonder also whether he has cleared it with the Minister of Natural Resources (Mr. Pope) so we can process our own nickel here. If it is a good idea in agriculture, perhaps it is a good idea there too. Maybe we should be even using our own iron ore; it is perhaps a little lower grade, but maybe we should be even using that in this province.

9:40 p.m.

I like the idea of some of the things the minister said, but it may be kind of dangerous over on that side of the House. You know, those are the kinds of things that may catch on, and then think of the trouble he will be in with his own party for promoting those kinds of democratic socialist measures.

I suppose most of this economic planning probably will end up as rhetoric, but I think there is some move in his statement towards accepting the principle of economic planning in the agricultural community; and if he and his government are sincere, I commend them for it.

There are a couple of other comments I want to make before going into specifics on the issues that concern me. First, I want to say that everyone agrees our farmers are productive. I suppose it is probably due to about five things. The first is that we have a vast agricultural nation and, compared with many other countries, it is still rather virgin land. In the history of this country, high priority has been given to agriculture.

There has been a desire all around, among governments as well, for the retention of the family farms. Unlike what is taking place in the United States with the corporate farms, we on both sides of the House and out in the communities have recognized that for a great variety of reasons there is merit in retaining the family farms.

One of the reasons our farmers are so productive is that there has been a general advance in technology and agricultural science, and it is probably fair to say that some of that credit goes to the government of Ontario for the institutions they have established and the work they have done for agriculture.

Finally, and perhaps most important, they are productive because by nature our farmers are hard-working and want to produce in abundance.

Mr. Riddell: Using the words of Ev Biggs, farmers have been sacrificed at the altar of their own efficiency.

Mr. Swart: That is right. I wish my friend would quit taking the quotes I intend to use a little bit later on.

The second point I want to make is that farmers and their productivity at present are in the most serious jeopardy since the Depression. The financing load, which I am going to deal with, although it has already been dealt with; the low and decreasing farm prices in our society; the trend, in spite of what the minister may have said, over the past two or three decades for imports to replace our own agricultural production; and finally, the loss of our best food lands -- all these are pretty serious and have to be dealt with in a very positive and rather massive way if we are going to continue the leadership we have had in our farm production.

I want to deal with the matter I mentioned first in the issues: that is, the financing costs and the interest payments that farmers are having to pay at present. We probably would agree that more than anything else -- and there are other factors -- it is the high interest rates that have caused the financial crisis and the liquidation of farming operations by so many farmers. There are other things, like farm prices, but the high interest rates they have been forced to pay for the past two, three or four years are the main reason that has brought them to the serious situation they are in at present.

The member for Huron-Middlesex mentioned that there were 145 bankruptcies to the end of October. I agree that figure is probably going to get worse; there probably will be at least 175 to 200 to the end of this year. It has been stated, I suppose semi-officially, by the Ontario Federation of Agriculture that there are 10 others that fold for financial reasons for every one that goes bankrupt. I discussed this with a number of the people in senior positions at the OFA, and I think the figure is perhaps closer to 20. In any event, it is somewhere between 10 and 20. What we are saying is that this year there are probably going to be something like 2,000 to 4,000 farmers who are going out of business. That is quite a percentage when we have only 60,000 farmers in this province.

The really serious part of this is that the majority of those who are going out of business for financial reasons are the younger farmers. The farmers in their 50s and 60s who have their family farms perhaps have them paid off, and they are not in nearly as serious a condition as the young farmers in their 30s and 40s who have bought farms and very expensive equipment that they need if they are going to operate economically. They are the ones who have the huge debt loads and who are going bankrupt or going out of business for financial reasons.

It would be difficult to overestimate the seriousness of that. Those in that age group, the younger farmers, are the ones we will be looking to in the next 10 or 20 years to produce the food in this province, and they are the ones who are being hit the hardest by the high interest rates on their financing costs. I doubt very much if the minister would disagree with me on that. I do not know whether any surveys have been done on this. I suggest that, if there are none, there should be. I would suggest they would confirm the comment I have made. It seems serious enough to me that we should know whether that is the case.

I want to put this matter in perspective for the House, this matter of these high interest payments on indebtedness versus the farmer's net income. I do not have to go any further than the minister's own publication, which demonstrates the frightening situation we are in. If we look at that document on farm operating expenses and depreciation charges from 1977 to 1981, and a five-year average from 1972 to 1976, we find the net five-year average from 1972 to 1976 -- and those were productive years for farmers, growth years for farmers, growth in the sense of larger operations and greater production -- was $650 million. The interest they paid on indebtedness was $131 million, which is about 20 per cent of their net farm income.

9:50 p.m.

When we go up to 1981, that $131-million average for those years had increased to $633 million, and we find that the net farm income was $835 million. That is 75 per cent, using round figures. The interest they have to pay is equal to 75 per cent of their net income. The minister and I both know that this year, for the first time, it is going to pass 100 per cent.

It is estimated -- again, these are official documents; this is Crop Conditions in Ontario, July 23, 1982, monthly crop and livestock report -- that net farm income will drop to $655 million this year. We know that, if anything, later reports will show that it is going to be even worse than that. There is no question that interest payments are going to be higher than $655 million.

That is pretty serious. It indicates a sad and dangerous economic situation in our society, and more particularly in the farm community. As I have already said, this situation is because of high interest rates more than anything else. Yet the Liberals and the Conservatives have promoted those high interest rates; in fact, they initiated them. They defend them as being desirable and necessary to fight inflation.

I think it is important to put on record the attitude of the Conservatives and the federal Liberals, and some provincial Liberals, with regard to these high interest rates. During 1979-80, when Joe Clark was Prime Minister of this country, there were four increases in interest rates. Although since then he has condemned the high interest rates of the Liberals, he really has no alternative. I have a newspaper report dated May 5, 1982, which is headed, "No Solution Quote Gets Clark Roasted in Prose and Poem." The story reads:

"Opposition Leader Joe Clark has become the laughing-stock of Liberal back rooms after telling a Montreal newspaper he can't think of an alternative to the government's high interest rate policy. 'We have looked for a solution other than the government's but we couldn't come up with an alternative,' he told the Montreal newspaper La Presse in an interview this week. 'At this moment, I do not have a better solution.'" That is Conservative Joe Clark.

The Ontario government has vacillated on this issue. I remember the Treasurer (Mr. F. S. Miller) saying here in the House that we have to have high interest rates, that he was not going to interfere with them. That may have been at the time Joe Clark was Prime Minister, but he supported the interest rates. Then, when public opinion showed strong opposition to the high interest rates, the Ontario government condemned the federal government.

But it is true that never once did the Ontario government, even at the Halifax conference, call on the federal government to take direct action to intervene with the Bank of Canada and order that the rates be reduced. The Ontario government has never done that. It has said, "If the federal government would change its policies and not run big deficits but do as we do here, we would not have high interest rates."

That is a lot of nonsense. Direct intervention was the only way those interest rates would have gone down then, and it is the only way they can go lower now, but the Tories would not do that.

Even in the debate on Bill 179, and whether it was said by the Minister of Consumer and Commercial Relations (Mr. Elgie) or by other ministers, I could bring out quote after quote about high interest rates having been necessary to fight inflation. I hope nobody over on that side will try to deny that.

The Liberals have done no better. I have here a newspaper article from the Toronto Star. The heading is, "Tighten Belts -- MacEachen." He is quoted as saying: "'Lower interest rates and better growth depend first of all on lower inflation.' This means the government has no intention of relaxing monetary policy to reduce interest rates." That is Mr. MacEachen. Of course, we know that to be the case.

Mr. McKessock: You have been doing pretty well on the Liberals and the Conservatives. Have you anything to say about the New Democrats?

Mr. Swart: Yes, I have a lot to say for the NDP government. The NDP government would have done what they have done in Germany. If the honourable member has read the papers recently, he will know that interest rates there are down to six per cent.

What surprised me most of all was the defence of the high interest rates by the Liberal member for Huron-Middlesex (Mr. Riddell) when he was speaking on Bill 179. The agricultural critic for the Liberal Party in this province, when farmers were being devastated, was defending the high interest rates.

I have Hansard here. He got up once or twice afterwards when I made these comments to say he did not say any such thing. I will just quote a little bit from Hansard. I think it is wise to have it on record. He says at page 4136: "In the opinion of some of the best economists in the country, and I have read many of their works, a restrictive monetary policy supplemented with temporary wage and price control represents the best policy choice if society wants to permanently lower the inflation rate."

Mr. Riddell: That is what the economists said.

Mr. Swart: Just a minute. He goes on to say at page 4137: "Thus the term 'anti-inflation monetary policy' should be understood as a euphemism for restricting demand, rising interest rates and rising unemployment. The cutting edge of an anti-inflationary, restrictive monetary policy is a large pool of unemployed workers who will increase the competition for jobs and thereby restrain wage and price increases. The economic cost of a tight monetary policy to lower the inflation rate is a short-run increase in the interest rate and the unemployment rate. The magnitude and duration of this short-term pain depend crucially on how quickly the market system adjusts to changing economic circumstances."

Then he goes on to say at page 4138: "First, we have the restrictive monetary policy, and to expedite that so we can get the inflation rate down, governments then impose wage and price controls. It is simple and pure economics."

He goes on to say at page 4139: "Proposals to lower interest rates in ways that would accelerate inflation are a contradiction in terms and would soon aggravate rather than alleviate stagnation."

The really choice part is where he says, at page 4137: "I will tell you I have researched work done by the economists and I have yet to run across an article where the economists would refute the things I am saying. If you can come up with it -- " Then there was an interjection. "I got all the material and articles I could out of the library and I have yet to come across an economist who would refute the things I am saying. If you can do it, then get up and make a speech."

I just want to quote for him tonight a few comments from economists, because there are none so blind as those who will not see. Obviously he rejected all the economists who did not agree with him.

There is a man by the name of John Kenneth Galbraith, who some people in this House may have heard about. He says in the Globe and Mail of Friday, October 2, 1981: "Canada should divorce itself from the high interest rate policies of the United States." He then goes on to talk about the need to lower the interest rates and says, "All the old elements of failure are somewhat exaggerated." He is talking about those who say it cannot take place.

Did the member hear of the economist Ernest Russell? He is a consulting economist and a fellow of the Royal Economic Society. His article is in the magazine Canada. He says: "In present circumstances, control of money supply and the exaction of a very high-price interest rate for its use confers a death grip on every sector of the economy from megaprojects in the petroleum section and the nation's major merchandizing chains, through average business enterprises, down to independent craftsmen and the individual consumer.

"The western tar sands projects have been put on hold because of constantly escalating costs of financing. The Hudson's Bay Co. recently stated that increased interest rates last year added $177 million to their unanticipated expenses." He says: "High interest rates are a direct major addition to every cost which, pyramided through the entire production process at all its levels and distributed to all its phases, is quite capable of doubling, tripling and even quadrupling selling prices."

10 p.m.

He says further: "To assert that a restricted money supply and high interest rates will wring inflation out of the economy and will maintain the exchange value of Canadian dollars is to demonstrate either a monumental lack of contact with the real world or an intention deliberately to mislead the naïve public."

Has the member heard of that economist? Did he ever hear, perhaps, of Walter Gordon, who has been fighting for two years as an economist against the high interest rates?

Mr. Riddell: Let's get back to agriculture.

Mr. Swart: I am dealing with agriculture, because, as I have already said, there is not a single factor or input that has destroyed the farmer more than high interest rates. If there is one thing I want to do in my speech this evening -- I suppose it is a futile hope -- it is to convince the members of parties on both sides of this House that there must be direct intervention in the interest rates at the federal level, promoted by this government, if we really want to get out of the economic malaise we are in at present.

This quote is from Mr. Reuben C. Bellan, professor of economics at St. John's College, University of Manitoba. I will not read all of what he has said, but he said in a recent public address:

"Gerald Bouey, governor of the Bank of Canada, expressed disappointment in the poor performance of industrial economies, including the Canadian, in recent years. As their worst failures, he singled out high unemployment, many bankruptcies, lagging productivity and stagnant real income.

"Bouey's concern about Canada's dismal record reminds one of the man who killed his parents and at his trial pleaded for mercy because he was an orphan. For it has been policy applied by Bouey that has been largely responsible for Canada's high rates of unemployment, numerous bankruptcies, low productivity and disappointing real income."

I promise the member for Huron-Middlesex that I will send him copies of these, because he could not find them in all the research he did on economics. I want to send them to him as soon as I have finished with them so that perhaps he will have some balance or perhaps he will change his position of defending a defenceless federal government.

What we really have is a Liberal government in Ottawa supported by the Tories there, and a Tory government in Ontario supported by the Liberals here, saying: "We have to have high interest rates. They are desirable."

Mr. Shymko: We never said that.

Mr. Swart: Of course; that is this government's policy.

Interjections.

Mr. Swart: Sure, I am paraphrasing, but it is accurate.

The Deputy Chairman: Order. The member for Welland-Thorold has the floor.

Mr. Swart: Their attitude is that if hundreds of thousands of people are wiped out of jobs, if farmers go broke and their income is cut by 25 per cent, if business, big and small, folds, tough: that is part of the price you have to pay. They say, "We are not going to deviate from our doctrinaire theories on monetary policy." That is what the Conservatives here and the Liberals in Ottawa are saying, and they are supported by the other two parties.

I suppose the Liberals and Tories here will say, "Look, interest rates are coming down and inflation is dropping." In fact, the Treasurer bragged about that here the other day in the House. I ask the minister whether he is proud of it. When net farm income is down 25 per cent, when the farm industry is belly up, when two thirds of a million people are out of work in this province, when the demand for consumer goods and capital is no longer there -- because interest rates and prices moderate slightly, are they cheering? Is that really something to cheer about? That is the situation.

It reminds me of a cartoon I saw about nuclear war, and I presume many of the members have seen it. In this cartoon, Russia, its allies and all of their people were wiped out. All of the cities in the west were devastated. Then a man came up from the subterranean hole where he had been living. He looked around, where not a building was left standing or a green blade of grass showing, and said, "Hurrah, hurrah, we won."

That is the same sort of thing those members are saying here when inflation comes down one or two points. They have devastated the economy by the high interest rates. There is another dimension to these interest rates, because the Liberals and the Tories refuse to control them. No one knows where they are going to be six months or a year from now. They do not know where the interest rates are going to be, whether they will be down to eight per cent or back up to 18 per cent.

Mr. McKessock: What did they do the last six months?

Mr. Swart: They came down. That is just what I am saying. One does not know where they are going to be eight months from now. Who is going to go into debt? What farmer is going to invest, what farmer is going to borrow another $50,000 or $100,000 to buy machinery or whatever the case may be when he does not know where interest rates are going to be because the government will not control the interest rates?

They do not know what interest rates they are going to have to pay when they pay off the debt. Even the lower interest rates now are not really providing the benefit they could if the government gave some guarantee it was going to hold them at least to the inflation rate.

This private enterprise system by the banks and the government to let interest rates go wherever they like is suicide. Interest rates are where controls have been needed and are needed now. I want to say to the Liberals that if they are so stuck on six and five, why do they not try that on interest rates and not on wages? I want to say to the Tories over there, if they are so stuck on nine and five why do they not try that on interest rates and not on wages?

There is something badly wrong or something pretty sick with governments that will control wages, in fact will break contracts to control them, but will not control interest rates when they are the real cause of our economic problems.

Interjections.

The Deputy Chairman: Order. The member for Welland-Thorold has the floor. I trust the honourable members will allow the member to continue without these distractions and interruptions.

Mr. Riddell: Mr. Chairman, on a point of order: I do not think we can allow the member to continue misrepresenting what we have said or what the farmers in the country are saying. The farmers are saying, "If you pay us the price our products are worth we are prepared to live with the high interest rates."

The Deputy Chairman: That is not a point of order.

Interjections.

The Deputy Chairman: I trust the honourable member will be able to continue now that they have quietened down.

Mr. Swart: I trust so, Mr. Chairman. One does not get interrupted and shouted down when one is making preposterous statements. It is when one is hitting home so that it hurts that one gets interrupted.

10:10 p.m.

Mr. Ruston: I am glad to hear that. Now we will know when you fellows are hootin' and hollerin'. Thank you very much.

Mr. Swart: It may be that in the circle the member for Huron-Middlesex moves farmers are not concerned about high interest rates, but if that is so it is an unusual circle. The farmers I talk to are very much concerned about high interest rates and would agree that is a major problem they have faced over the last three or four years.

Mr. Riddell: If you give them the price for their products they will live with the high interest rates. They do not want to be given any more special consideration than any other business person.

The Deputy Chairman: Order.

Mr. Swart: We in this party are not asking that they be given any more consideration than any other business person. We think the interest rates should be a hell of a lot lower for people who have mortgages to pay. We think they should be a lot lower for small businesses that operate on borrowed money. We think they should be uniform across this province. The consumers, regardless of what field they are in, should not be paying excessive prices for everything they buy because somebody has decided that interest rates should be doubled or tripled. That is what we believe in this party.

I suppose there is an alternative to intervening on high interest rates. They are saying over here: "Leave interest rates high, that is no problem. Deal with them in some other manner. The alternative is to assist or subsidize those who are being hurt by those high interest rates." That is really pretty ineffective, because the sums required are so vast that no government can meet more than a small percentage of the need. Our research department computed that the difference between 10 and 20 per cent interest rates on mortgaged homes in Canada is between $5 billion and $6 billion a year. Is the minister saying he is going to give those kinds of subsidies? Of course not.

Another example is that for the last three years Ontario farmers have paid a half billion dollars more in interest payments than if the rate had been at 10 per cent. That is approximately a half billion dollars Ontario farmers have paid in the last three years. This year alone they will pay in the neighbourhood of $150 million to $250 million extra. Is the minister going to find that kind of money to reimburse them for those excessive interest rates? Some provinces have gone quite a way, but Ontario has not gone very far, has it?

The government paid something like $13 million on one program and $5 million on the sow weaner program, if I am correct. That is about $18.5 million the government is paying out this year because of the desperate situation the farmers are in because of the high interest rates. Ontario has done practically nothing. As the member for Huron-Middlesex said, this is the only province in Canada that is not extending long-term credit to the farmers.

I would like to put on the record what the other provinces are doing. Ontario with 60,000 census farms has no long-term credit whatsoever. British Columbia with 10,000 census farms has provided $18.6 million. That is the amount outstanding and that is an average of $1,765 per farm. That does not mean everybody has it, but that is the amount per census farm. Alberta has $659 million outstanding, 47,000 census farms, and the average it pays per farm is $14,130. Saskatchewan has $129 million, 60,000 census farms, $2,130.

Manitoba has $152 million outstanding on its provincial long-term farm credit, 24,000 census farms, $6,000; Quebec, $1.096 billion, 33,000 census farms, $32,000 average per farm; New Brunswick, $53 million, just over 2,000 census farms, $24,000 per farm; Nova Scotia, $99 million, 2,480 census farms, $39,919, practically $40,000 average per farm; even little Prince Edward Island, $18 million, 2,223 census farms, an average of $8,000 per farm; and Newfoundland, an average of $12,000 per farm.

When we raised this in the House the other day, if I remember correctly, the minister said two things. He said: "We agreed a long time ago that is a federal government responsibility. We are not going to get into long-term credit and we are pushing them to provide a greater amount of credit." I think that is paraphrasing the minister fairly accurately. Then he went on to say: "I think the member would also be interested in seeing some information which was printed recently, I believe, in the Windsor Star, and I would be glad to send him a copy of the article detailing how some of those credit policies in another province, in this case in Quebec, have if anything worked to the detriment of many farmers in encouraging overindebtedness and extremely poor credit positions."

Surely the minister recognizes that the percentage of bankruptcies in this province is much higher than in Quebec. The percentage of bankruptcies has been the highest of any province in Canada last year and this year. How can he make a statement like that? The real benefit of these plans, of course, is that they provide a lower interest rate. There is no question about that; they provide a substantially lower interest rate.

I have here Farm Credit in the Canadian Financial System, a recent publication by the Farm Credit Corp. Canada, which, of course, the minister will have. It shows that the average interest rate of the provincial government agencies in 1980 -- those are the latest figures available -- was 11.1 percent. The banks were at 15.3 per cent. That was on long-term loans. That is a tremendous difference: 11.1 per cent to 15.3 per cent. Even on intermediate loans the banks were charging 15.8 per cent and the provincial governments were at 13 per cent.

How can the minister say this is not really a benefit to the farmers and by some convoluted reasoning say in this House that those farmers in Quebec are worse off because they are getting this, when we are having more bankruptcies for census farms and when they are getting cheaper interest rates? That is just so much nonsense.

Even on the short term it is difficult to get the figures. Some of them are in that book, but I think we can agree that it is very difficult, because there are various programs and so on, to decide exactly what any given province is doing in short-term assistance to their farmers. But certainly Ontario is not out front in that.

Perhaps the best example to give of where we stand is the percentage of our budget that we are spending on helping the farm communities. I want to read these into the record. In Saskatchewan they spend 3.25 per cent of their budget on agriculture; in Alberta it is 1.98 per cent; in Prince Edward Island it is 4.5 per cent; in Manitoba it is 2.1 per cent; in Quebec it is two per cent; in Nova Scotia it is 1.3 per cent; and then in Ontario -- and I have listed the main agricultural provinces -- it is 1.2 per cent of the budget this year.

That is by the minister's own figures in the briefing material that he gave us: $179 million in assistance to the farmers this year. It has already been stated that he has not carried through with the promise that he and his government made in the budget last spring to assist the starting farmers.

10:20 p.m.

I would like to remind the minister of what was said and hope that in his reply to the member for Huron-Middlesex and myself he will refer to this statement in the throne speech, on page 7, referring to his government: "It places a high priority on continuing to attract young people to establish themselves in this vital sector of our economy" -- agriculture, of course; and these are the significant words -- "and will introduce a new measure to provide them with startup capital assistance." He has been postponing that again and again until we have every reason to believe that he has little or no sincerity in carrying out that promise this year.

As already mentioned, the Ontario farm adjustment assistance program has paid out something like $13.6 million. I noticed the minister neglected in his speech to the Ontario Federation of Agriculture to state the actual payout. He mentioned the amount of loans he had guaranteed and that sort of thing. I do not blame him for being a little ashamed when he has set up $60 million in a program and he has paid out only $13.6 million.

Am I right in assuming that he has paid nothing yet in guarantees? I hope he will answer on that. Quite frankly, I hope that would be the situation. But to use $13.6 million to deal with the problems faced by the farmers of this province is simply preposterous. It cannot start to meet the needs that exist there.

I am sure the minister knows that in spite of the manner in which he dressed it up, the likelihood is that the two programs he dealt with -- the OFA tax reduction program and OFAAP -- will likely eventually pay out substantially less to the farmers next year than they have this year. With the desperate situation they are in, that is a wholly unsatisfactory answer.

With his farm tax reduction program, he raised it from $5,000 to $8,000, and I am going to dwell on that. For all the reasons given by the member for Huron-Middlesex, there are going to be a lot of farmers who are not going to get it this year who would have got it if he had left it at $5,000.

Under OFAAP, with interest rates lower, if they stay there -- I certainly hope they do, but there is no guarantee -- and the extension of the plan on the same basis, dealing only with whatever is over the 12 per cent, he is going to be paying out substantially less there, even though he estimated this year that he would pay out $5,000 and ended up paying out only $3,000.

What we have here is a government which, at the most crucial time in the province's farm history, is drawing back on the assistance to farmers. The farmers' needs have never been greater and it has never been more crucial to bridge that gap, the gap where they find themselves now, where thousands of them are teetering on the brink of financial disaster. They may see lower interest rates down the road, but they must have some help to get over that short period of time and the minister is cutting back on the payments to them.

On this whole matter of farm finance the Ontario government's record, past and present, is dismal and it is going to be worse in the coming year. In summary, what the minister has done is to support, along with the Liberals, a high interest rate policy which has been and is devastating to the farmers; and he has done almost nothing to relieve the massive impact on them. That is a factual statement.

I want to move on to the second area I wish to cover and that is the matter of farm produce, but, Mr. Chairman, because I will be dealing with that for some 20 or 25 minutes, if it is your wish that you want to see the clock at this time, I would be glad to accept that.

On motion by Hon. Mr. Timbrell, the committee of supply reported progress.

The House adjourned at 10:27 p.m.