32nd Parliament, 3rd Session
































The House resumed at 2 p.m.


Mr. Roy: Mr. Speaker, I rise on a point of personal privilege in relation to standing order 19 in the rules of debate with regard to a statement made by the Minister of Health (Mr. Norton), which is quoted on the front page of the Toronto Star. His response was to a position taken by the federal Conservative Party that it is now in support of the Canada Health Act. The Minister of Health was quoted as saying, "But Norton, provincial health minister, said he wasn't surprised by the news. 'They've taken the position for political purposes,' Norton said."

As members know, the rules of debate prohibit imputing motives to the opposition, but I think is shameful to --

Mr. Speaker: This has nothing to do with the rules of this House.

Mr. Roy: -- impute motive to the national leader of the Conservative Party --

Mr. Speaker: The honourable member is out of order.

Mr. Roy: -- and I protest on their behalf.

Mr. Speaker: It is neither a point of order nor privilege. Thank you very much.


Mr. Speaker: Order.

Mr. Nixon: Mr. Speaker, I have a separate point of order, which is based on a statement reportedly made by the Minister of Health with regard to Mme Bégin, which I feel brings all members of this House under a cloud. I would like to quote two points made by the minister in this news release. He said, "We have to try to get Mme Bégin to cool her jets long enough to have the level of emotion lowered to the point where she can actually engage in some rational discussion . . . the period of time when her parents were ill, a number of years ago. I understand she used that as an argument against what she perceives or is portraying as deterioration of the health care system."

I submit that these personal comments about the policies enunciated by the federal minister bring this House into disrepute. They impute motive, and are chauvinistic and unnecessarily condescending.

Mr. Speaker: Order. Again, I must rule that the honourable member is out of order. It is neither a point of order nor privilege. The statements were not made in the House and, of course --

Mr. Nixon: They were made by a minister of this House.

Mr. Speaker: -- I was not aware of what he said or did not say.


Mr. Bradley: I have a point of order you will agree is a point of order, Mr. Speaker.

Mr. Speaker: I will bet you do.

Mr. Bradley: I know you will agree with me when you hear it.

This is regarding the release of the public accounts, volume 3, which is important to all members of this House. In checking the delay in the release of volume 3 of the public accounts, we were able to obtain the following information which I think should concern all of us.

According to the clerk of committees and to the Provincial Auditor's office the reason for the delay lay with the Treasurer's office. Our researchers spoke to Bill Childs, who is with the Treasurer's office and is the public accounts co-ordinator and responsible for the volumes. According to Mr. Childs, the reason for the delay is that the printers had a strike and it has resulted in a delay of a couple of weeks. Mr. Childs added he was optimistic that volume 3 would be available next week, maybe even Monday; after the session ends, of course.

Our researcher called the printers, Carswell Printing Co., to confirm Mr. Childs's story. According to Mr. Rivers, a manager with Carswell who is familiar with the printing of this document, volume 3 was printed and shipped to Mr. Childs and the ministry weeks ago, at least two weeks ago, and he had no idea what Childs was talking about. Just to confirm this, to show how we want to be thorough, our one researcher then asked another researcher to call Mr. Rivers and confirm what he had been told. The same explanation was repeated.

Mr. Speaker, the point of privilege, order or whatever you interpret it to be is that the Treasurer (Mr. Grossman) appears to be withholding important documents from members of this House until after the House has recessed.

Mr. Speaker: Contrary to the rather optimistic attitude of the member for St. Catharines, I must rule him out of order. That is neither a point of order nor privilege.


Mr. Speaker: Order.

Hon. Mr. Grossman: Mr. Speaker, do you wish me to rise on a --

Mr. Speaker: Not really. Because it was out of order, there is nothing to respond to.

Hon. Mr. Grossman: The leader of the party can use one of his questions to find out.


Mr. Breaugh: Mr. Speaker, I rise to seek your advice. I received a communique from the county council of Simcoe. I want to read it to you, sir, and then seek your advice on the matter. The resolution was passed unanimously by the county council of Simcoe this morning and it reads:

"Whereas the provincial government has introduced Bill 142 to enforce annexation of land presently in the township of Vespra to the city of Barrie without ascertaining in a proper and democratic manner whether such annexation is required; and

"Whereas prior to the introduction of such legislation this county had passed a resolution opposing annexation" --

Mr. Speaker: Order. Interesting as it may be, it is not a point of order.

Mr. Sargent: Don't you realize it is Christmas?

Mr. Speaker: I beg your pardon?

Mr. Breaugh: Mr. Speaker, I am seeking your advice. If you would just let me quickly --

Mr. Speaker: I have just given you my advice. You are out of order.

Mr. Roy: I believe our batting average is not very good this morning. Is that not true, Mr. Speaker?

Mr. Speaker: Mine is perfect.

Have all the statements been distributed? May we ask for the indulgence of the House while statements are being distributed, or do members want to ahead with ministerial statements before the statements are distributed? Have they all been sent around? Okay.

Hon. Mr. Grossman: Mr. Speaker, do I take it the House has agreed that the statements might be distributed? Okay.



Hon. Mr. Grossman: Mr. Speaker, I wish to present to this assembly a prebudget statement. This initiative represents a new and innovative approach to public policy development in Ontario.

My predecessors established an important process of prebudget consultation by meeting with many individuals and groups. To facilitate a full exchange of information and ideas, we are continuing this successful tradition and expanding the scope of our discussions. We are opening up the budget process to interested groups and the public at large.

Mr. Haggerty: How about the opposition?

Hon. Mr. Grossman: I am glad you asked that. So that members of this assembly may have an opportunity to comment and provide input, I will be taking this statement to a legislative committee the first Wednesday in January. We will see you all there.

2:10 p.m.

Mr. McClellan: A whole day in committee. Wowee!

Hon. Mr. Grossman: You won't have enough to say to fill a day.

This document presents an economic forecast for 1984 and sets out the imperatives for successful adjustment to worldwide economic transformation. It analyses our current fiscal circumstances and details major transfer payments for 1984. Finally, it provides a revenue forecast and evaluates appropriate deficit levels.

We believe those who wish to participate in the consultative process will benefit from having access to this information. We now have in place the framework for meaningful and productive discussions on fiscal, economic and social policy in Ontario, and I am confident that this more open process will enable us to produce budgets that fully reflect the values and goals of our people. No government is more determined to meet the economic and social challenges ahead than the government of Ontario under the progressive and sensitive leadership of our Premier (Mr. Davis).


Hon. Mr. Grossman: For many years.

Mr. Speaker: Order.

Hon. Mr. Grossman: Over the past year economic recovery in Ontario has strengthened and gained momentum. In employment we have regained almost 90 per cent of the ground lost during the recession. Consumer confidence has also risen steadily during 1983. The major areas of strength at present are those typical at this stage of an upturn: consumer spending and the building up of inventories run down during the recession.

However, there are still four areas of concern. Despite relatively rapid development growth, unemployment rates are projected to remain relatively high. Investment, particularly in plant construction, has been slow to recover. Inflation also remains a cause for concern; while the rate of inflation is half what it was a year ago, inflationary expectations are still high. Finally, the economy remains vulnerable to a rise in interest rates in response to international financial developments.

Economic trends in Ontario are closely linked to those in the rest of Canada and to international developments, particularly in the United States. This is a result of the relative importance in Ontario of industries that engage heavily in trade with other jurisdictions.

The economies of most industrialized nations are recovering from last year's recession. The turnaround has been most significant in North America, although fortunes have also brightened elsewhere. While the rebound has been rapid, the world appears to be settling into a slower and more stable pattern of economic growth. This steadier pace may well help avoid the buildup of inflationary pressures and thus contribute to a more sustained expansion.

There have been very favourable developments this year in those key US sectors that have a direct impact on Ontario's economy. For example, there has been a sustained pickup in auto sales and in housing starts. Business investment has also revived, and retail sales have experienced steady growth. The Canadian economy turned around in early 1983, and growth has continued since. Employment growth has been rapid through the year, while inflation has decelerated.

Ontario has benefited both from the international economic resurgence and from the recovery in the rest of Canada. Several factors, including our diversified economic structure, have caused the pace of recovery to be faster in Ontario than in the rest of Canada. Retail sales, housing starts and employment growth have all been stronger in the province, and 196,000 jobs have been created in the 12 months since November 1982.

Our broadly based recovery includes strength in agriculture, forestry, mining, services and manufacturing. In the agricultural sector realized net farm income is expected to increase by 10.6 per cent this year. In forestry real output increased at a rate of over 28 per cent in the first half of 1983. The mining sector followed a similar pattern, with real output increasing at a 46 per cent rate. In the service industries, an increasingly important sector of the economy, 101,000 jobs have been created since November 1982.

The manufacturing sector, which was hard hit by the recession, is benefiting from the recovery as well. Our total automotive trade surplus with the United States in 1983 will exceed the surplus of 1982, which was the first since 1972. The turnaround has been significant in the paper, chemicals, nonmetallic minerals and furniture groups, and performance in primary metals and metal fabricating industries has also improved. Overall, manufacturing employment in November 1983 was 79,000 above year-earlier levels.

The May 1983 budget made a substantial contribution to the recovery. Budget measures, including the retail sales tax exemption on furniture and appliances and our expanded job creation programs, helped to stimulate economic activity.

I would like to present our current assessment of the economic outlook for 1984. Until now Treasury's economic projections have been presented as part of the provincial budget. As such they have reflected policy changes in that document. By providing this information now, we are establishing the framework for a more constructive exchange of views on budget policy to improve economic momentum next year.

I should emphasize, however, the outlook we are presenting here assumes no change in policy direction at either the federal or provincial level. There will undoubtedly be new developments over the next several months and international circumstances may also change.

We project in 1984 real output in Ontario will grow at the rate of 4.7 per cent. This is somewhat higher than the projected rate for the rest of Canada, but a little lower than the growth rate in the United States. I have attached a chart on these projections that shows that Canada and Ontario will significantly outperform the combined nations of the Organization for Economic Co-operation and Development.

Our gross provincial product growth in 1984 will, we expect, be driven by stronger consumer spending, inventory rebuilding and a modest increase in machinery and equipment investment. The consumer price index is expected to increase by 5.3 per cent. While this is an improvement over the past several years, let me say so clearly and explicitly, 5.3 per cent is still much too high. There is still cause for concern about Canada's international competitiveness.

Wage increases will and must be moderate in 1984. However, consumer spending will remain relatively strong. Retail sales will rise 9.6 per cent, as a significant increase in the number of income earners helps generate a 9.4 per cent increase in the total personal income of Ontarians.

Total investment, that is, investment in plant and equipment and housing, is expected to increase by 10.4 per cent in 1984. The growth, however, is likely to come entirely from investments by business in machinery and equipment and from housing investment. Housing starts are forecast to increase to 58,000 units. However, the outlook for nonresidential construction projects remains very weak through 1984.

Economic recovery then is well under way. However, we continue to confront a major transformation of the economy. Traditional patterns of employment, skill requirements, investment and industry growth are changing dramatically. Each has profound implications for the structure of our economy, our public and private institutions and our individual work and lifestyles. Budget and economic policies must be directed at facilitating and managing these changes.

This transformation is caused by many factors. High real rates of interest are playing an important role. In addition, rapid introduction and dissemination of new technologies, increased foreign competition, growing protectionism and a still rapidly growing and changing labour force are all interacting to produce a critical mass of economic change.

The most significant changes are occurring in the areas of business organization, new technologies and human resources. The world is fast becoming one single marketplace, and this is changing the industrial structure of the entire world. Mass-production goods increasingly are being made in the lowest-cost countries of the Third World. At the same time, the comparative advantage of industrialized jurisdictions is shifting into high-value-added financial, scientific and business services on the one hand, and precision-manufactured, custom- tailored and technology-driven products on the other hand. Economic policy must build on these strengths.

2:20 p.m.

While high-volume, standardized goods production is rapidly becoming the domain of the newly industrializing countries, sound economic policy can ensure this does not mean the disappearance of such industries in mature industrial countries. We must help these industries to restructure towards higher-value-added and technologically more sophisticated products; for example, specialty steels and chemicals. advanced machine tools and precision-engineered auto components.

High real rates of interest have slowed the growth rates of traditional, interest-sensitive industries. However, they will also accelerate the introduction of new technologies, particularly those that save capital. They are already encouraging the introduction of new inventory cost-cutting measures. In turn, the improvement in inventory control techniques will alter the location of suppliers relative to assembly plants, which in itself will change the industrial landscape. Similarly, the high cost of financial capital has led to a virtual revolution in financial products for both business and individuals. Again, this has profoundly changed the competitive environment of our financial institutions.

These are all permanent changes. They will produce significant improvements in the productive use of capital. Each will lead to a ripple of further changes in the economy, including employment dislocation and relocation. In every sector of the economy, businesses will have to adjust or be left behind. Budget policy must assist in this adjustment.

High interest rates have led to high unemployment throughout the industrialized world. This in turn has heightened international competition and increased protectionism as every nation attempts to increase exports, reduce imports and create jobs. Each has made the international, economic and political environment more challenging.

For example, high interest rates and recession have made Third World debtor nations more determined to increase exports to service their foreign debt. Similarly, their austerity programs have led to import restrictions, which increase the difficulties of selling even high-technology products in their markets.

The United States too is in the throes of an industrial-regional transformation. Several observers have pointed to the decline of some heavy industries in the United States, the rise of high technology and service employment, the increasing openness to foreign trade and investment, and the population and industrial shifts from the northeast and north-central areas to the south and west.

These trends have been evident for some time, but they have been accelerated over the past few years by high real rates of interest, by an overvalued dollar, by the defence buildup and by regulatory reform. As the political process in Washington accommodates and adjusts to these transformations, there will inevitably be profound consequences for Canadian industry and Canadian public policy.

Mr. Rae: What is this, a seminar?

Mr. Mackenzie: Is this guy the Treasurer of Ontario?

Mr. Foulds: Is this your first term paper on economics 1? We do not care about this nonsense.

Mr. Speaker: Order.

Hon. Mr. Grossman: There is also an internal transformation occurring in our own work force. The labour force participation rate of women has risen from 38 per cent --

Mr. Martel: Don't give us lectures. Go give your lecture to somebody else. You are wasting the time of the House.

Hon. Mr. Grossman: If my friend does not care about women's issues, let him keep talking.

The labour force participation rate of women has risen from 38 per cent in 1966 to 56 per cent in 1982. The current rate is more than 70 per cent for women aged 25 to 54.

While there are a host of issues which face women today, among the most serious are those of economic opportunity and participation. My colleague the Minister responsible for Women's Issues (Mr. Welch) and I are addressing these issues related to women in the economy. Women must have the opportunity to make economic choices based on adequate knowledge of and equal access to training, career selection and investment and pension options. All of these issues must be addressed in budget policy formation.

Continued rapid labour force growth over the past 10 years has made job creation a social and economic imperative in Ontario. Indeed, we have outperformed most other jurisdictions in this regard --

Mr. Martel: Your restraint package is a pile of nonsense.

Mr. Rae: Nothing happened. What are you doing now? What are you waiting for? You have done nothing all fall.

Hon. Mr. Grossman: As I told the member early in the week, I predicted he would say that instead of listening.

Mr. Rae: This is an abuse of the House, Mr. Speaker. He is not announcing a thing.

Hon. Mr. Grossman: I say to my friend, if you do not want this, do not ask for prebudget consultation.

Mr. Rae: Why don't you table the document? Table the document and let us get on with the business of the House.

Mr. Speaker: Order.

Hon. Mr. Grossman: Do not ask for it.

Mr. Rae: You are not creating a single thing, not one job. Not one young person will get any benefit from this. Not one older worker is going to get anything. Mr. Speaker, let us get on with some action.

Mr. Speaker: Order.

Mr. Rae: File it in tinsel, Larry. That is all it is. He is wasting the time of the House, Mr. Speaker. This is an abuse.

Mr. Speaker: I caution the member for York South (Mr. Rae). I will not caution him again.

Mr. Martel: I hope you say that to your colleagues the next time you try to put them down. I have listened to too much of this nonsense. You can name us all you want.

Mr. Speaker: Order, please.

Mr. Foulds: Sit down, Larry. The Speaker is on his feet.

Mr. Bradley: Where is Ian Deans when we need him?

Mr. Rae: This is a nothing. It is hot air covered in blue ribbon.


Mr. Speaker: Order. Now, I cautioned you.

Hon. Mr. Grossman: There is too much good news in it for them.

Indeed, we have outperformed most other jurisdictions in this regard. We must continue to do so. In the midst of this sea of economic change, our labour force growth will continue to outstrip other mature industrial jurisdictions.

In summary, this is only a brief glimpse at the mass of changes involved in the transformation of our economy. Many more will unfold. But one thing is certain. In this rapidly altering world, we will not return to what we have come to regard as "normal" in terms of the type of skills requirements, the organization of institutions or the structure of our economy. All these changes will demand imagination and creativity in our budget strategies.

Economic transformation means first and foremost the transformation of our labour market. Service sector employment will continue to grow, as will international trade in this vital sector. Many more jobs will be created in business and information services, in computer software and in engineering and marketing. Employment opportunities will also grow in industries that produce high-technology products: robotics, aerospace, telecommunications, ceramics, lasers and health technologies. The use of new production techniques will help to maintain the competitiveness of some of our basic industries. Yet these industries will be compelled to restructure on the basis of new products and new methods of management. As a result, new skills will be required and growth in traditional employment will fall.

Industrial transformation, whatever its cause, inevitably destroys some jobs. But it can also create many more than it destroys. Budget and economic policies must focus on investing in the transformation to ensure that we gain the full benefits and realize the new job potential. We must make investments now, but we must make them for the longer term. Money spent on short-term, nonproductive programs is money taken from long-term human resource development and industrial and financial restructuring.

The key to emerging from this transformation with full employment and a strong, wealthy and competitive economy is investment. We must invest now, before it is too late, and we must invest wisely -- in skills training, innovation and long-term job creation.

Our budget must seek net job creation in the private sector in excess of new additions to the labour force, higher real incomes in a noninflationary environment and maintenance of the economic and fiscal capacity of the province to finance priority social and environmental programs and to ensure our economic recovery.

We must create both more jobs and better jobs -- secure jobs with high value added. In a rapidly transforming national and international economy, achieving these goals requires budgets that encourage investment, skill development, innovation, competitiveness and greater community involvement. These are issues to which I now turn.

Budgets can help to create an environment conducive to investment in at least three basic ways. The first is to avoid sudden, unco-ordinated changes of direction in economic policy. For example, changes in the rules governing saving, investing and working must be pursued in a spirit of public consultation and intergovernmental co-operation. Stability and clarity in the rules of the game are even more critical in a period of rapid economic change. While the federal government has not always been responsive to this need, Ontario has consistently championed this fundamental objective. This statement is a further effort to increase public participation in the development of that policy.

Second, budgets must ensure that the rewards to investing in Canada are comparable to those abroad, particularly in the United States. In part, this requires maintaining competitive tax rates. As outlined in appendix C to this statement, Ontario has done this, and we will continue to do so.

Third, budget policy must not allow public sector domination of the economy. This demands sound financial management in the public sector, an issue to which I will return.

2:30 p.m.

The internationalization of the economy has been accompanied by the growing mobility of capital and technology. People -- human resources -- tend to be less mobile. Therefore, future investment location decisions will depend increasingly on the availability of human skills and knowledge. These things will be the key determinants of national wellbeing.

Moreover, a rapidly changing economic environment, coupled with a shifting composition of the labour force, also demands that a high budget priority be given to education, training and retraining. The current work force must be able to move from low skill levels to high skill levels, from declining firms and industries to expanding ones. As well, they must be able to adjust to new flexible production systems. Similarly, new entrants or re-entrants to the labour force will be more quickly absorbed if they have access to training or retraining.

Experience with our existing programs suggests that specific skills are best acquired while on the job. Budget policy must foster this. At the same time, our colleges and universities are best at teaching core skills, learning techniques and knowledge which are essential to an individual's future adaptability to a changing economy. Growing enrolments reflect the widespread recognition of this fact. Accordingly, the ability of our colleges and universities to continue to respond effectively to these needs should be a high priority of social and economic policy.

We must continue to focus on training and education to resolve the critical problem of youth unemployment. Traditionally, young people have had significantly higher unemployment rates than those 25 years of age and over. This reflects lower levels of experience, fewer skills and more time spent in searching for a rewarding career opportunity.

Moreover, the recession of 1982 hit young people especially hard. Young workers typically suffered first. Lack of seniority led to early layoffs and there were too few job opportunities for new entrants. This is not to minimize the fact that more senior workers also suffered large increases in their unemployment rate. But youth unemployment went up from a rate which was already high by comparison.

While the youth unemployment rate has dropped from 18.6 per cent in November 1982 to 14.7 per cent this November, there are still 155,000 unemployed young workers in Ontario. This is unacceptable.

Mr. McClellan: Thanks for telling us. We are deeply grateful.

Mr. Foulds: It sure as hell is unacceptable. What are you doing about it?

Mr. Speaker: Order.

Hon. Mr. Grossman: We are resolved to speed the flow of young people into the general economic recovery. Again, however, a major focus should be to ensure that our youth acquire the skills and the experience to prepare them for the future as well as find immediate employment.

Economic recovery has brought about a sharp increase in the number of jobs for all age groups. As indicated earlier, the province's job creation policies have accelerated this trend. Young people have been and continue to be the focus of much of our efforts. In 1983 alone, we have supported the creation of more than 100,000 jobs for young workers.

Although funding for most of the existing programs is now fully committed, some of our new initiatives -- for example, the young Ontario career program -- still have thousands of openings. Furthermore, other 1983 job creation initiatives are still on stream or coming on stream, and they are providing new jobs daily. We believe there is a need to provide still more training and job opportunities for young people, particularly during the winter months. I will announce appropriate improvements to our existing programs and some new initiatives within the next few weeks.

In addition, at our meeting in Montreal, ministers of finance agreed to explore innovative ways to use unemployment insurance funds and Canada assistance plan funding for job creation.

The international environment has placed renewed emphasis on enhancing our international competitiveness. There are two central elements to this task. The first is to increase productivity. The second is to ensure that our income demands do not outstrip the gains in productivity. Increasing competitiveness is the surest way to produce more jobs and higher real incomes.

Mr. McClellan: They must be proud of themselves if this is the best they have to offer the people who are laid off in Ontario.

Mr. Laughren: The Tories must be embarrassed at this garbage.

Mr. Speaker: Order.

Hon. Mr. Grossman: All industrial jurisdictions have experienced a trend decline in productivity growth over the past 10 years. Increased energy prices played a role. Also, the work force has grown so rapidly that the amount of capital per worker has fallen. But these do not explain all or even most of the decline in productivity growth. A substantial part of the decline was due to a slowdown in both technical innovation and the adoption of new techniques of organization.

Yet this is beginning to be reversed. For example, the world is now entering a period of intense technological innovation. Recent advances in microelectronics, computer-aided design, fibre optics, ceramics, robotics, information processing and biotechnology are just the beginning.

We must develop budget and economic policies to accelerate this wave of innovation. The world economy is becoming a competition in which the first to introduce new technologies gains market shares which then yield the dividends for further innovation and expansion. We must invest in the business, research and technological skills necessary to ensure that our own high-tech industries succeed in this competition.

Existing manufacturing industries are also undergoing a significant transformation. The use of computer-aided design and manufacturing has become increasingly widespread, particularly in the machine tool industry, the automobile and aerospace industries and the resource sector, but it also has important implications for more traditional industries such as footwear. Our budget policy must seek ways to catalyse these changes.

It is not enough simply to focus on increasing productivity through technological innovations and human resource development. Our economic policies must also play an active role in the reduction of domestic inflation. The public sector wage restraint program and the restraint of administered price increases have helped substantially. They reduced double-digit cost escalation in the public sector and, in combination with a similar federal program, reinforced moderating trends in wage and price pressures in the private sector.

It would be wrong, however, to believe that inflation is no longer a problem. We know that inflation can cost jobs through the loss of competitiveness. We continue to be in some danger in this regard. Since 1980 we have lost competitive ground relative to our trading partners. Renewed inflation will put all of our markets, both at home and abroad, at risk.

Deliberately creating recession to control inflation entails huge costs. There is little doubt that the deep recession just ended was partly the result of restrictive monetary policies in the United States and other industrial countries, including Canada. Those policies were a response to double-digit inflation set off by the 1979-80 round of international oil price increases.

Despite the recent decline in inflation, there is no guarantee we will not face similar kinds of disturbances again. Yet we have seen what enormous costs in lost output, jobs and human suffering our present national and international monetary approaches entail.

This budget process must begin a serious search for new policies to encourage a closer link between income gains and productivity increases. Perhaps this can be accomplished through vehicles such as profit-sharing arrangements. In any case, now is the time to hear new ideas. The jurisdiction that resolves this most fundamental issue will insulate itself from foreign disturbances, gain a major competitive edge and free itself from the tyranny of restrictive monetary policy. We are prepared to be innovative and creative. I say this as both a statement of intent and a challenge to business and labour.

I believe Ontario's economy is based on distinct economic communities. Each has its own unique resources, opportunities and problems. Each represents a complex interaction of industries, local suppliers and human resources. Each exports and imports. Each represents the nucleus for a creative response to economic transformation.

Communities can develop a threshold of economic activity that suddenly accelerates into an ever-expanding interaction of new investments, innovative spinoffs and new skills development. Famous examples can be found in the Silicon Valley in California and around Boston; we have our own examples in Ottawa, Toronto, London and Kitchener-Waterloo, to name a few. Our idea is to create many more such examples, each with its own unique characteristics, each accentuating its own human and natural resource base.

As the transformation proceeds, we believe the community must be an even more integral part of the process of facilitating and investing in this change. New technology can accelerate development everywhere in Ontario. It can improve productivity and competitiveness in the agricultural and resource regions, accelerate investment and change in our industrial heartland and provide new opportunities and services.

Our success in capitalizing on the opportunities of the 1980s will depend critically on the involvement of our municipalities in this process of adaptation and change. Accordingly, we are actively considering new policies involving flexible community development assistance centred around new enterprise areas and geared to local enterprise and initiative. I invite comment on how we might implement these.

2:40 p.m.

In 1980, this government created the Board of Industrial Leadership and Development, charged with the task of marshalling provincial resources to support and facilitate the industrial transformation in Ontario. Appendix B to this statement documents the program of investment in human resources, industrial competitiveness and community development initiated by the board.

I turn now to our capacity to invest in economic transformation. Making strategic investments without jeopardizing our fiscal stability will present a major challenge. In assessing our ability to meet this challenge, I would like to review our current fiscal situation and the deficit.

In terms of fiscal policy, some will suggest that the economy requires added stimulus and that the deficit should be allowed to rise. Others will argue that growing deficits are inflationary, contributing to higher rates of interest and impeding long-term economic growth. In order to assess these options, we must look at the deficit level from several standpoints, including historical trends and comparative performance.

While our deficit has increased during the past two years, and this is a matter of concern, the increase has been far lower than that experienced at the federal level in the United States and Canada, as well as by other Canadian provinces. Further, as a proportion of gross domestic product, our deficit is less than it was in 1975-76. In the United States, by comparison, the financial needs of the government have grown sizeably since 1975-76. For the past two years, the United States deficit has stood at about $200 billion -- 6.3 per cent and 5.4 per cent of the economy. This is the highest level since the Second World War.

This is a major source of concern, as public sector financing requirements may dominate capital markets, crowd out borrowers and place upward pressure on interest rates. Such developments would impede economic recovery and place further pressure on our deficit.

Recent experience at the federal level in Canada is equally disturbing. The federal government's cash requirements or deficit is estimated at $27 billion for 1983-84, or 6.7 per cent of the gross national product -- well above the 2.9 per cent level recorded in 1975-76. When we compare our deficit level with other provinces on a per capita basis, or in relation to the size of the economy, we are in the most favourable position. Details are included in the chart that accompanies this statement.

In recognition of our strong economic base and commitment to sound fiscal management, we continue to have the highest possible credit rating. That rating has enabled us to obtain the best possible terms, conditions and provisions on financing, borrow at lower rates and choose among a wider range of markets. For taxpayers, this has meant a much lower burden of public debt interest.

Last week, all ministers of finance agreed that the continuation of deficits is a matter of concern to all governments in Canada. I believe our deficit level must be reduced over a period of time. In assessing our capacity to achieve this objective, I would like to outline the relationship of our deficit levels to capital expenditures as well as examine current trends in budget spending.

First, I will deal with capital investments. Government has a clear responsibility to provide many social services as well as to influence and encourage economic growth. As such, we are a major investor in basic infrastructure, from hospitals and schools to roads and serviced land.

In private industry, it is an accepted principle that the cost of capital investments be amortized or spread out over a period of time. In government, we do not use this accounting principle. Public sector capital costs are treated as a current expenditure and written off, as it were, on a 100 per cent basis in the first year. While that is the accepted basis for public sector accounting, it tends to obscure the long-term economic and social benefits associated with such investments. Therefore, it is important to examine our budget from the perspective of capital spending. In fact, cash requirements have been less than capital investment in five of the past nine years. In some jurisdictions, this would have been called an "operating surplus."

While the deficit issue is not as onerous when viewed from this perspective, in no way do I wish to minimize our concern about current deficit levels. Although the deficit was less than capital spending for four years, up to and including 1981-82, our cash requirements have risen above capital spending in the past two years. That was appropriate given the need to stimulate the economy and maintain our programs of social assistance, but now we must strive to reduce the deficit below our level of capital investment.

A policy of deficit reduction should concentrate on containing expenditures rather than increasing taxes. Yet when we examine which major areas of government spending can be further reduced, we must bear in mind that the largest proportion of our expenditures is already committed for health, education, social services and local governments. A policy of massive expenditure reduction would clearly affect these important services.

To date, we have chosen not to pursue such a course of action. While we have restrained growth in these areas, we have maintained realistic levels of support. To continue this we must, and will, increase transfer payment levels next year, a subject to which I now turn.

On November 8, I announced that next year our transfer payments to municipalities, school boards, universities and other publicly funded institutions, as well as allocations for our own civil servants, will provide for average compensation increases of up to five per cent.

I also informed members on an earlier occasion that, in response to the requests of transfer recipients, the levels of transfer payments would be announced before the end of this calendar year. Today I wish to outline the percentage increases in a number of these payments. My colleagues the Minister of Education and Colleges and Universities (Miss Stephenson), the Minister of Municipal Affairs and Housing (Mr. Bennett) and the Minister of Health (Mr. Norton), will provide further details to recipients and others.

Before determining these allocations, my colleagues and I met with many groups affected by the transfers, including the Ontario Hospital Association, the Council of Ontario Universities, the Ontario Public School Trustees' Association and the Association of Municipalities of Ontario. We thank them again for their valuable advice and counsel.

While the transfer levels I am announcing incorporate a five per cent increase for average compensation, we have considered other important factors affecting the funding requirements of some transfer payment programs. Those factors include changes in public utilization as well as program expansions and reductions. In addition, we should remember that some payments, such as per capita grants, are not tied directly to the costs of services.

I would also like to emphasize that these are all average figures. They apply to the total amount transferred by the province. Individual institutions will receive different percentage increases based on individual circumstances. Therefore, recipients should not expect all transfer payments to increase by the same five per cent figure next year.

First, I will deal with education. Operating grants to the university sector will be increased by 6.5 per cent next year. This reflects the five per cent wage and salary guideline plus additional requirements. Colleges of applied arts and technology will receive an average 7.5 per cent increase, also reflecting wage guidelines and other requirements. In the case of school boards, the growth rate in the general legislative grant will be five per cent.

Turning to the health sector, we plan an average increase of eight per cent in operating grants to hospitals in 1984-85. This is designed to accommodate the five per cent guideline as well as full implementation of programs previously in place and growth in utilization.

Finally, turning to municipalities, I wish to indicate that the percentage increase in unconditional grants in 1984-85 will be five per cent.

Details on other municipal grant programs will be announced over the next few weeks.

We believe we have developed a framework designed both to contain costs and provide realistic and fair compensation to those employed in the public sector. In the end, however, all of us, both employers and employees, have an individual responsibility to exercise restraint. Further, we must continue to ensure that high-quality services are delivered to taxpayers in the most cost-effective way possible. Efficiency in this government is a priority at all times, not just during a period of restraint.

This, of course, has been a major focus of our fiscal policy. When our expenditures are examined in relation to those of other Canadian provinces, it is clear that we have achieved considerable efficiency. In assessing the scope for further efficiencies, the members will be interested in some recent trends in our programs.

2:50 p.m.

A chart included in this statement shows that spending on hospitals, medical services and other health care programs takes a significantly larger share of the budget today than four years ago. Resource programs and social services also occupy a greater proportion of total spending. Relative spending on education has reflected flattened growth in enrolment. However, the decline in budget share has been concentrated in the general government expenditure category where we have continued to trim overhead costs.

In the future, it is likely that we will still have to direct an increasing proportion of the provincial budget to health care. This is due in large part to shifts in the age structure of population. In 1981, those aged 45 and over comprised 30 per cent of the population. By the year 2006 an estimated 43 per cent will be in that age group. This suggests that any major reductions in health spending are unlikely and inappropriate.

My colleague the Minister of Health is undertaking important efforts to realign the system so that it reflects these demographic shifts while enabling us to control cost increases. But this will require great co-operation from all.

While health care costs continue to take a large and increasing share of our budget, health spending in Ontario, including private spending, is not out of line with the rest of Canada. When measured in relation to the economy as a whole, total public and private expenditures in this area are considerably less than health care spending in the US.

While on the subject of health care, I wish to reiterate our concern over the federal government's failure to pay a fair share of the costs in this area. Since 1979-80, Ottawa's share of Ontario's health care costs has declined from more than 49 per cent to 41 per cent. These figures include the 1977 tax transfer, as well as the recently announced payments of funds owed by the federal government. In terms of cash alone, federal grants now cover --


Mr. Speaker: Order. Will the member for Nickel Belt (Mr. Laughren) just restrain himself, please?

Hon. Mr. Grossman: In terms of cash alone, federal grants now cover only 24 per cent of provincial health care costs. Further, the new federal health legislation would empower the federal government to reduce health care funding even more by way of regulation.

Because of their large share of the budget, health care costs have implications for all areas of government spending. Unless the federal government increases its levels of health care funding, other programs may face a declining share of the provincial budget or taxes may have to be raised.

As I indicated earlier, our flexibility to effect further reductions in government spending will be severely limited by the major portion of the budget committed to local governments, education and services for people. A chart in this statement shows that these allocations, when combined with public debt interest, account for about 82 per cent of the budget. Out of the remaining 18 per cent, we must pay for programs such as the administration of justice and provincial highways, as well as our own salaries and wages in the public sector in the province.

Nevertheless, it may be in areas such as these that we will have to find the scope for further efficiencies. As our discussions continue, I look forward to advice and suggestions from the public on ways in which we can further reduce government spending.

At the same time, we will examine the issue of taxation. In so doing, we must be very sensitive to the negative impact that tax increases can have on individuals and businesses, particularly during a period of recovery. An increase in the sales or personal income tax could retard consumption growth. An increase in corporations income tax could slow capital investment.

Alcohol and tobacco taxes are already quite high and further increases could have a negative impact on the tourism industry and tobacco farmers.

In any discussion of tax increases, we must also keep in mind the need to maintain a competitive business environment, one that continues to attract job-creating investment. Appendix C to this statement compares our tax levels with those of other provinces and industrialized American states.

Before leaving the subject of taxation, members will recall that in the 1983 budget my colleague the member for Muskoka (Mr. F. S. Miller) announced that a review of the mining tax and the small business development corporations program would be undertaken. That process is now under way and I look forward to further public input in these two areas.

In discussing the dimensions of our 1984 budget. I would like to outline the guidelines within which we must operate.

First, budget policy must be developed within the framework of estimated overall expansion in the economy, which of course is the basic determinant of revenue growth. Experience has shown that in the absence of taxation changes, our revenues increase at a rate slightly lower than the growth rate of gross provincial product.

Second, we must keep in mind the major transfer payments I have just outlined as well as the compensation guideline outlined in November. These commitments, plus our allocation to medicare, will account for more than 50 per cent of our expenditures in 1984-85.

Third, in my opinion we have to contain and reduce the deficit. For reasons I outlined earlier, it was appropriate to allow the deficit to increase during the recession, Now that the economy is growing, however, the level of our deficit must be stabilized or reduced.

The preliminary forecast for 1984 indicates that revenues will be $24.1 billion, an increase of 8.2 per cent. This represents the amount that will be yielded by taxes and other sources of revenue and assumes no change in various taxes and bases.

Clearly, this amount of revenue will restrict our flexibility. If, for example, we were to allow expenditures also to increase by that same 8.2 per cent, reflecting the rate of growth in revenues, the deficit would rise to over $2.9 billion. We must, in my view, take steps to stabilize or reduce, not increase, our deficit next year.

In examining provincial borrowing requirements, it is necessary to take into account borrowing by Ontario Hydro. This is an important factor in the determination of capital availability, in the assessment of our credit rating and in the long-term interest costs borne in total by our citizens.

After careful review and evaluation of its current borrowing plans, I have indicated to Ontario Hydro that I need it to reduce its 1984 borrowings by $200 million. Hydro has agreed to do this.

I would like to conclude this statement with the following thoughts.

The challenges we face are formidable. Unemployment among young people is a serious and complex problem. Overall rates of unemployment are still too high. The pressures of inflation remain. Deficit levels for all governments must be reduced. There is massive industrial transformation under way.

In this report, we have presented an analysis of Ontario's economy and public finances. In so doing, we have established the framework for meaningful discussions on budget policy. I am confident that out of those discussions will come a budget that makes an important contribution to our goals of sustained recovery, long-term growth and new job creation.

Further, budget policy must also address our social priorities. It must address those priorities directly through sensitive and creative tax policy and indirectly by helping to create a dynamic economic environment which generates sufficient revenues to support and expand our social systems.

We believe that by creating clear incentives for investment we can help to ensure continued growth and provide for the needs of our people.

We should not delude ourselves into believing, however, that government budget policy can by itself guarantee employment growth and economic recovery. We will also need the dedication and commitment of those in the private sector, both labour and business. They will have to be as efficient as they expect government to be. They will have to restrain their own prices and wages just as they expect us to restrain taxes and expenditures. They will have to invest in our economy. They will have to invest in their businesses, in their jobs, in equipment, in people, in innovation, in skill training, indeed invest in co-operation itself.

We will encourage this investment to the best of our ability, but in the end it will require the commitment and determination of all Ontarians.

Our objectives are clear. To find ways of meeting those objectives, we are asking for constructive advice and creative ideas from all segments of our economy and from people in all parts of the province. This document has been prepared to encourage that input. Every suggestion we receive will be carefully considered as we prepare the social and economic document that will be the 1984 Ontario budget.


Mr. Speaker: Statements by the ministry; the Minister of Education and Colleges and Universities.

Hon. Miss Stephenson: Come on fellows, cool it.

3 p.m.


Hon. Miss Stephenson: Mr. Speaker, there has been in recent months, and indeed in recent years, a great deal of discussion about the role of universities in today's society, and the structure of the university system and the various government policies that have attended the development of the universities in this province over the past two decades. In recent months, I have intentionally encouraged discussion on these matters and as a result have received many interesting ideas from various groups with an interest in universities and from the public at large.

This discussion has not been unique to Ontario. The matter is one of consideration and debate right across the western world. Given the foundations of the universities, I believe this is a discussion that will always be with us and rightly so. I will begin by reminding members of some of the background to this important discussion.

Twenty-five years ago there were five universities in Ontario serving 22,000 students. The universities at that time were largely independent institutions, and proudly so, and perhaps somewhat elitist in outlook and practice. They constituted almost the entire post-secondary sector of Ontario. Even in 1960, when student numbers stood at about 30,000, public funding for the universities ran to only $25 million. Today there are more than 180,000 full-time and 100,000 part-time students enrolled in Ontario universities. The cost to the taxpayer is more than $1.1 billion annually.

These changes were brought about by necessity. In the early 1960s the universities carried the responsibility of meeting the sharply rising demands for further education. The government adopted a policy whereby qualified students might attend university unimpeded by financial considerations. In announcing a new student aid program in 1959, the Honourable James Allan, Treasurer of Ontario, stated that "the government's objective was to ensure that no student who has the capacity will be deprived of the opportunity of attending university and developing his talents to the fullest possible extent."

At that time, however, it became apparent that to meet the highly diverse interests and needs of our population, accessibility to post-secondary education had to be more broadly defined. The Premier (Mr. Davis), then Minister of Education, in 1965 said: "We probably must now recognize the inevitability of some form of post-secondary education, i.e., beyond grade 12, for all capable of profiting from it. Further education must be provided for in a variety of courses or programs, varying in length from a few weeks to six or more years, in new types of institutions, as well as in universities." To meet this need, the colleges of applied arts and technology were established.

The emphasis on diversity was continued in the 1972 report of the Commission on Post-Secondary Education in Ontario. commonly known as COPSEO, which stated, "A system of post-secondary education committed to the principle of universal access must vigorously pursue the goal of educational diversity."

The development of the colleges of applied arts and technology has led to a tremendous growth in overall post-secondary enrolment and places Ontario proudly in the forefront of the industrialized countries in this world in terms of participation rates. The college system has met and continues to meet the challenges of training, retraining and community development through post-secondary education.

Turning to the relationship between government and the universities, the basis of the government's policy has been in place for many decades. Post-secondary education has developed on the basis of a diversity of institutions rather than a single institution, and government has recognized it should avoid involvement in the internal governance of the institutions.

The Spinks commission report of 1966 presented a major challenge to this policy. In its concern about the dangers of unrestricted competition for resources, that commission advocated the establishment of a university of Ontario with a governing superstructure to provide more systematic planning and control. This aspect of the report was, I believe, rejected by all parties at the time. COPSEO, however, considered various options for government-university relationships. That committee advocated a middle road between total control and a totally decentralized system by suggesting a buffer body with executive powers delegated to it by both government and the universities.

The Commission on Post-Secondary Education also dealt with the research responsibility of universities. This vital role of the institutions has been the subject of considerable debate over the years. That Commission on Post-Secondary Education was very critical of the mechanical linking of research funds to graduate instruction in the funding formula. It recommended the separating out of funding of certain kinds of research and instructional costs for the purpose of providing better planning of graduate studies and as a "powerful solvent of institutional rigidities."

While indicating its preference for the decentralized system in place at the present time, the Committee on the Future Role of Universities in Ontario foresaw that government intervention would be needed under certain scenarios. It indicated a preference, in circumstances of financial stringency, for a one-time intervention for the purposes of restructuring, followed by a return to a decentralized system of autonomous institutions.

The government indicated, in response to the report of the Committee on the Future Role of Universities, that measures such as closure of institutions were unacceptable. Following release of the report, discussions took place among the Premier, the university presidents and myself to identify alternative ways of bringing about the kind of rationalization which the committee felt would be necessary under continued conditions of financial restraint.

However, the diversity which makes our universities strong also makes it impossible for them to reach consensus on the actions needed to bring about such changes. None the less, the government remains committed to the view that an in-depth examination of alternative approaches to university education at the operational level is necessary.

With regard to the role of the university system in society, the Ontario Council on University Affairs in 1978 proposed to government a set of objectives which government recognized and accepted as meeting the needs of the people of Ontario and Canada. These objectives and the commitments of the past have served Ontario well. We are now in a new era with new challenges and new needs.

We shall have to face the future in ways that are anticipatory, enhancing those things we do well and selectively improving or eliminating other things. Both government and the universities are agreed that, above all, excellence must remain the highest priority for our universities. It is the development and maintenance of this excellence that is vital to the future of the universities and the people of Ontario.

The dangers associated with enrolment forecasting are not new, and we all know that reality does not necessarily follow demographic projections. We must face, however, over the coming five to 10 years, the very real possibility of a reduced demand for university places.

Statistics Canada data indicate a decline in the traditional 18-to-24 age group, the basic group from which universities continue to draw the major portion of their enrolments. Similarly, the study released in October by the Council of Ontario Universities outlines four scenarios for enrolment to the year 2000. All four project downturns in enrolment through the 1990s.

Furthermore, research has shown a positive correlation between youth unemployment and undergraduate enrolment. It is logical, therefore, to anticipate a reduced demand for undergraduate post-secondary education in its traditional forms at least as we move into and through the period of economic recovery.

May I stress, however, that the government is not proposing a narrow approach to planning for university education in the 1980s and 1990s. It is indeed possible that some combination of employment factors; participation, including part-time study; retention rates, and population shifts may result in continued high demand for post-secondary education.

3:10 p.m.

My colleague the Treasurer (Mr. Grossman) has already introduced a new restraint program for this province. His statement reminds us that we must not ignore the continuing economic reality of our times. We have no choice but to continue to exercise restraint in all the activities we undertake with taxpayers' money.

In any consideration of the relationship between the government and the universities, we must also recognize the role of the federal government in the 1980s and 1990s. The federal government, fully aware of the cost of university education and of the still-growing demand for a highly educated populace, is seeking greater visibility for its financial support and greater accountability for its expenditures on university education.

We in Ontario have long considered our universities to be national resources, educating as we do a significant number of students from all the other provinces of Canada. We recognize the federal government as a partner in the development of a responsive and relevant higher education system in this new era, while we hold firmly to provincial constitutional rights in this area. We cannot ignore the potentially damaging changes in the financial arrangements between the federal and provincial governments at this time.

The arbitrary removal by the federal government of the 1977 revenue guarantee and the imposition this year of the six and five restraint factor to that portion of the transfer payments that the federal government attributes to post-secondary education merely continue the pattern of federal reductions and compound the difficulties faced by the provinces in seeking to maintain excellence in higher education at a time when our province and our country most require it.

The impact of federal actions is felt in another, more subtle but more serious way. As basic transfer funds are whittled away to permit earmarked federal expenditures on aspects of post-secondary education unrelated to traditional undergraduate teaching activities, our capacity to meet our past commitments to accessibility for all qualified applicants is similarly eroded. Without downplaying in any way the value of federal initiatives in research and development, we must express grave concern about the offsetting reduction in those areas that serve to ensure traditional university strength and accessibility.

Studies initiated by the Canadian Committee on the Funding of University Research and carried out by the Canadian Association of University Business Officials in 1979 and 1982 indicate that the indirect costs of expanded research activity are adding a great deal more burden to regular operating costs of those institutions than had been thought previously. In the ongoing federal-provincial dialogue this issue must be taken into consideration so that resources available for the institutions' other activities are not squeezed by expanding costs of federally sponsored research.

The federal-provincial issue is only one of the significant areas of change that we have to face in the 1980s and 1990s. Another is the need to come to grips with a major shift of emphasis in our society as a whole, a shift reflecting the change from an almost exclusively industrial-based society and economy to one that is increasingly information-based.

Emerging technologies call for a new emphasis within the university community, and the new emphasis argues for a preservation of great strength in liberal arts curricula, while developing and integrating these with the vast and expanding array of skills and knowledge connected with such areas as microtechnology, biotechnology and the computer-related resource developments that are already upon us. We must ensure that a healthy balance remains between the development of specific skills and the wholeness of knowledge traditionally associated with the university.

Our universities have been active in meeting this shift, and so has the government. The Board of Industrial Leadership and Development has played a major facilitating role. At the time of its establishment in early 1981, the board recognized that Ontario's strongest asset continues to be its human resources, and the shaping of these human resources into productive, creative members of our society continues to be a task left heavily to our education systems. We can no longer afford, however, in economic or social terms to maintain any system of education without more precise targets, more defined directions and more responsive institutions and programs to meet the needs of Ontario.

At the same time, we must ensure that the universities do not become viewed as skills factories concentrating on short-term skill development at the expense of producing graduates who, while skilled, are also educated and able to help themselves and their society adapt to still unknown changes.

One of our greatest human resources is our university faculty. Professor Peter M. Leslie in his 1980 study for the Association of Universities and Colleges of Canada referred to the ageing of university faculty as the greatest problem facing Canadian higher education; avoiding the loss of an academic generation is its greatest challenge. In 1982-83 more than 30 per cent of Ontario university faculty were over the age of 50; this figure has risen from 22 per cent in 1977-78. At the same time, the proportion of new blood in the system represented by those below the age of 35 has declined in an equal but opposite fashion -- from 21.3 percent in 1977-78 to 12 per cent in 1982-83.

We must, therefore, develop over the next few years a more flexible and dynamic response to faculty requirements. To do so, we will need the co-operation of faculty as well as the creativity of academic leaders. We must consider the full range of incentives, rewards and opportunities to encourage faculty mobility where it is lacking, development where it is needed and retirement where necessary or advisable. Faculty renewal will be a cornerstone of the government's plans for our revitalized system in the 1980s and 1990s.

Having reviewed the historical development of our university-government relationship, it is clearly appropriate that we pursue this commitment in a broader context and in the context of economic realities.

The universities in Ontario were built by the co-operative action of communities, academics and government. They will continue to be developed through this type of co-operative action. Nevertheless, the time has come in the relationship between government and the universities for government to exercise leadership through a short-term intervention in the planning process.

The government sees a need to appoint a commission to produce a detailed operational plan to effect the necessary changes in the university system to address these issues.

Mr. Bradley: What was wrong with the Fisher report?

Hon. Miss Stephenson: The member has not read the report, obviously.

Since its establishment in 1974 the Ontario Council on University Affairs has tendered advice on a whole wide range of subject matter regarding the university system and it will continue to do so. Currently, the council is preparing advice on a number of issues of vital interest to both the university community and the government. These issues concern matters such as program approvals, fees, incremental costs of bilingualism and graduate planning.

The council will continue to have a major influence on the shape of things to come. I believe, however, that it would be inappropriate to add to the already significant task of the council the immediate and additional burden of this undertaking. Therefore, the commission is being asked to present to the government a plan of action to reshape the university system. This reshaping will maintain and enhance the quality of university education by ensuring the appropriate concentration of academic strengths in the areas of intellectual and social importance.

The commission will not be expected to involve itself in prolonged debate at the conceptual level but will capitalize on the extensive work that has already taken place in the recent past and derive from it a specific operational plan. Without appearing to restrict the scope of activities that the commission should pursue. I should like to outline a number of issues that clearly fall within the mandate of this undertaking.

The first issue concerns the structure of the universities as a system. What we have in Ontario today is a number of universities, each with its own history, all developing under a definition of the university which reaches back to the Middle Ages for its origins.

I believe the universities of tomorrow should have a more clearly defined, different and distinctive role. Each one of those should assume a character and a structure which is consistent and compatible with that role. I also believe this plan for tomorrow can be accomplished without reducing the number of universities in Ontario, although fundamental changes may be necessary to some or to all of the institutions.

3:20 p.m.

Each university cannot aspire to universality. The individual universities must be encouraged to build upon their unique academic strengths. In the process, the commission will deal with a number of related issues. The government believes the establishment of highly specialized designated-purpose institutes through co-operative involvement of the universities and the business sector could contribute significantly to our economic recovery. This type of specialization would serve to provide expertise that could respond to provincial and national objectives as well as to industrial initiatives, while maintaining a high level of research activity.

The commission will consider the designation of specific universities as centres of specialization with a view to preserving and developing further a calibre of teaching and research that is characteristic of those that play a pivotal role in Canada with their international reputations.

As well, the range and nature of programs appropriate to the role of each institution with reference to historical strengths, geographic and language considerations need to be established. At the same time, recognition must be accorded to the necessity of differing proportions of research and teaching within individual institutions to enable a level of dedicated service to the university's community.

I shall also ask the commission to consider the issue I referred to earlier concerning technological advances in the delivery of university education. The use of this technology with reference to the provision of opportunities to geographically remote areas as well as the cost effectiveness that such technology may bring must be developed as a key part of our plan for tomorrow.

Secondly, the issue of accessibility to university- level education needs to be addressed and articulated in the context of a differentiated university structure. Minimum admission requirements for some time now have been interpreted to mean a 60 per cent average in grade 13. I would postulate that our university system can adopt a policy of accessibility consistent with and appropriate to its various missions as well as the individual missions of the institutions. The commission, therefore, will clarify the meaning of accessibility in the context of economic realities in its recommendations on restructuring within the university system.

Mr. Cassidy: That means you are going to shut out working-class kids. That is what you are going to do.

Mr. Speaker: Order.

Hon. Miss Stephenson: Its review should recognize the importance of new patterns of credit study that embrace the concept of lifelong learning, including part-time and recurrent education.

The commission will address a number of specific issues related to accessibility, such as the need for and the form of general and specific entrance examinations to the Ontario university system, with particular reference to the new secondary school curriculum structure.

Concerns expressed by parents, students, academics, university administrators and taxpayers have caused me to reflect critically on the needs of the people of the province. In this matter I must indicate my growing sympathy for the position taken recently by the Ontario Council on University Affairs that career-related programs in universities should be assessed in terms of economic and societal needs. It is important not only to respond to new program initiatives in the light of such needs, but also to undertake as well a zero-base review of our current programs in all of our institutions.

I am led, for example, to wonder whether we truly need 10 faculties of education producing over 3,000 graduates annually at a time when the potential for teacher employment remains uncertain. Similarly, the Law Society of Upper Canada has expressed real concern about the number of graduates produced annually by our six law schools. These faculties are expensive to maintain, particularly if employment opportunities for their graduates will be severely limited.

The difficulties inherent in forecasting manpower requirements, particularly over the time necessary for the planning and adjustment of university-linked programs, are very well known. Notwithstanding this, and recognizing the high level of sensitivity in this area, I am specifically charging the commission to address the need for a process whereby adjustments could be regularly made to the resources allocated to the professional programs, such as education, law, medicine and dentistry, for example, and to the level of enrolment in these programs to respond to changing labour market requirements.

The third issue is that of resources for the university system. Continued restraint in public sector spending is necessary if we are to facilitate the province's recovery. As I have noted, our federal-provincial fiscal arrangements with respect to post-secondary education make it imperative that our expenditures in university education be constrained within that strategy of restraint.

The Ontario government will continue to allocate to the university system global operating grants as generously as it possibly can, consistent with this policy. The commission will address the method of distribution of these grants to the universities. The government's basic position is that the transfer of public funds to autonomous institutions in the form of operating grants is acceptable only if the mechanism for such transfer provides an adequate and measurable basis for public accountability.

In this connection, I should like to recall the essence of the recent discussion between the Provincial Auditor and the standing committee on social development in September 1983. At issue is the question of accountability on the part of the universities and the extent of that accountability. It is the view of the Provincial Auditor that, although the existing system of financial accountability or financial reporting is adequate, there remains a need for the government to satisfy itself that the universities are being well managed.

As we all know, measuring economy, efficiency and effectiveness is in itself a challenge, especially with regard to social programs. Recognizing this, the government maintains the view that universities are autonomous and should remain autonomous in the governance of their affairs and in ensuring their responsibilities as institutions of higher education are discharged with integrity.

This view was expressed by the Committee on the Future Role of Universities in Ontario when it described university autonomy as embodying three elements: the freedom to determine who shall teach, what shall be taught and who shall be taught. Nevertheless, it must be recognized that government has the responsibility to ensure that its transfer payments are spent and managed well.

A further concern is the sometimes aggressive competition for students that an enrolment-related distribution mechanism might encourage. None the less, that distribution mechanism must be sufficiently flexible to permit adjustments from time to time in response to the ongoing evolution of the new university structure. The commission will give this aspect particular attention.

There are specific matters that the commission will be asked to consider in developing its operational plan:

Appropriate ways to encourage ongoing faculty renewal and replacement;

The appropriateness of program weights as one of the determining factors for funding distribution arrangements;

The possible separation of research funding from instructional funding to ensure a harmonious blending of provincial and national objectives in research carried out in the universities;

The distribution of provincial capital support and the role of private sector support in the maintenance and enhancement of the physical structures of the system; and

Appropriate tuition fee policies that reflect, on the one hand, the accessibility policies recommended, and on the other hand, equitable levels of student contribution with respect to the overall cost of the university system.

The fourth issue is the need to have mechanisms for regulation, co-ordination and provision of advice to government. These are required to ensure that the new university structure responds to societal needs in a co-ordinated manner, including the approval of new programs and the retirement of existing programs, at both the undergraduate and the graduate levels. In this area the commission will clarify the role of the Ontario Council on University Affairs in the context of a new and differentiated university structure. OCUA, of course, will be requested to comment upon all the plans created by the commission.

Earlier this year, OCUA advised the government to implement a new operating grant distribution formula commencing with 1984-85. For reasons I indicated to the university system in May 1983, the government could not accept the council's recommendation. Although, as I said earlier, the need for the commission to examine the distribution mechanism remains, I am persuaded that a change in the distribution of operating grants for 1984-85 is warranted.

3:30 p.m.

For next year, each institution's grant will consist of two thirds of its grant calculated with the current formula and one third of its grant calculated under the new arrangement. This new distribution mechanism addresses in a substantive way the separation of base funding from incremental funding. Details of this will be announced shortly to the university community.

I am pleased to announce that Dr. Ronald L. Watts, principal and vice-chancellor of Queen's University, and Dr. J. Fraser Mustard, former vice-president of health sciences at McMaster University, former member of the Ontario Council on University Affairs and now president of the Canadian Institute of Advanced Research, have both agreed to serve as members of the commission. The third member will be announced shortly.

The commission's mandate is to develop a detailed plan for the reshaping of our university system as outlined in this statement. The commission will have access to all public briefs to OCUA, all the working papers of the Committee on the Future Role of the Universities and any other documentation required from government.

It should be stated clearly that the total resources to be made available to the new university structure will not differ substantially from those that would normally be allocated. The commission should proceed on the basis that annual increases to those resources will reflect the government's policy of fiscal restraint and prudent management of public funds. For the 1984-85 year the operating grants to universities will be increased by 6.5 per cent over the allocation for 1983-84.

I have a commitment from the Premier that there will be due consideration of additional funds to facilitate faculty renewal and adjustments arising from the commission's recommendations. The commission will report its plan of action to me in the summer of 1984. The government commits itself to the implementation of a renewed university system founded upon the decisions and directions determined by the commission.

The universities of this province have held a strong and distinguished place in the life of Ontario. It is our commitment that they will continue to do so. The pursuit of excellence and the preservation of integrity must remain the foundation of our universities.


Mr. Peterson: While the Treasurer (Mr. Grossman) is coming back to his desk, I will tell the Minister of Education (Miss Stephenson) that this new commission today, in addition to all her other commissions, is a mission of complete failure of government policies in the higher education area.

Mr. Speaker: Question, please.

Mr. Bradley: She has already had the Fisher commission.

Mr. Peterson: And a variety of others.


Mr. Peterson: Mr. Speaker, I have a question to the Treasurer. Members will be aware that it has been our party's view for some time that meaningful prebudget consultation was necessary. Indeed, it was desirable to have wide public input into the policy process. Members will also be aware that this document presented today is just fluff. There is no substance. It is a blue-bound shell.

The only matters of substance in this document, the only specific determinations, are the municipal transfers and the various transfers the Treasurer announced today, as well as the cutback on Ontario Hydro for some unspecified reason. Presumably he will share that information with us at some time.

My question to the Treasurer right now is this: Given his own admission of the very high levels of youth unemployment, given the fact that every forecaster in this country predicts that situation will last for some long time and in spite of his figures that he has created 100,000 youth jobs -- and he did not add that this translates into only 35,000 year-long, full-time jobs; nor did he mention that all the while there were 200,000 unemployed young people -- why would he not vigorously attack that problem of youth unemployment in his statement today?

Hon. Mr. Grossman: Mr. Speaker, as I have indicated earlier, our programs are still coming on stream. The youth unemployment problem was vigorously attacked by my predecessor, the member for Muskoka (Mr. F. S. Miller). Some of his very good programs are just coming on stream now. The young Ontario career program, which we have talked about for many days here, will take up yet another large number of positions, 10,000 at the very least.

We are also looking at enrichments in some current programs, but we want to do those in conjunction with the federal government, which has indicated that the Canada assistance plan and the unemployment insurance moneys will be available to do that.

I am determined to use all the resources available and to do it in a co-ordinated way. As I said in my statement, I do not think we are performing a public service if we use for a period of weeks some of that money now in what is really nonproductive cheque-granting. I want to use our resources to do something meaningful for those young people other than just be able to rise in this House and say, "Oh yes, I have created a few thousand jobs for the next three months."

We have to do better than that. We have to get a larger number and we have to make real investments in those young people. To do that, we need the assistance of the federal money that is forthcoming, and we need to assess better our current programs. In the meantime, our young people will be looked after by the current programs, which are under way.

Mr. Peterson: The minister talked about waiting for the federal government. That is the chronic response from his government, his colleagues and himself. It is like waiting for Godot, and it justifies his inaction at all times.

Why is it that the minister's own governmental response is so inadequate and so uncoordinated in this matter? Yesterday he told us in this House after questioning that he had altered the qualification age for the young Ontario career program from 20 years down to 15 years; it was only upon a phone call from our researcher to the director of Ontario career action program that he was even aware of the minister's change in the qualification.

How does the minister expect to launch a co-ordinated assault on the question of youth unemployment in Ontario when no one knows what is going on over there, including himself?

Hon. Mr. Grossman: Obviously, we had just reached the decision to make that change as recently as yesterday morning.

Mr. Peterson: Why would you not tell us that? We had to drag it out of you.

Hon. Mr. Grossman: The honourable member did not have to drag it out of me. I told him when he asked me. Had I followed the example of the federal Liberal government, I would have delayed it so I could get maximum coverage for it. I would have done it at the expense of the young people and, for that matter I would have announced it six times, the same program with new initials on it.

Ms. Copps: Like the paramedics program. You have announced that six times and it is still not on stream.

Mr. Speaker: Order.

Hon. Mr. Grossman: Rather than waiting, however, I took the first available opportunity to let the member know. That is the responsible thing to do. I am sorry I did not dress it up with big, fancy press releases and that we had not yet communicated that through the system. The decision was arrived at literally yesterday morning, and I thought the appropriate thing to do was to get it out into the public domain; that is where it counts.

Mr. Rae: Mr. Speaker, I am surprised the minister feels he needs lessons in how to package things in fancy press releases that do not have any meaning to them. I would not think the Treasurer needs to take any lessons from anybody in all of Canada in that field.

The Treasurer stated he is going to be announcing some improvements to existing programs and some new initiatives in the next few weeks. He knows how disappointed we are that he did not announce those this week.

One of the problems of which I am sure the Treasurer is aware is the fact that unemployment among young blacks and other visible minorities is especially high and especially worrisome. Can the Treasurer tell us whether he is going to introduce a program this winter directed particularly at the problem of unemployed black youth and the youth of other visible minorities? These young people are adversely affected in a proportionate way by the present economic circumstances. Is he going to have a program that is going to deal directly with that issue? It is a very real problem, particularly in Toronto.

Hon. Mr. Grossman: Mr. Speaker, that is a very good example of part of the concern we have with regard to mounting these programs quickly. I have spent a great deal of time this fall, as my staff will tell, in trying to get an analysis of the unemployed youth individually. I think it is a mistake for us to presume that we simply put out a large program costing many millions of dollars and creating many positions and pretend that we are getting maximum effect for it.

3:40 p.m.

We must know who the young people are who have the particularly difficult problems. The ones who are least likely to apply for some programs because they are not used to interacting with government, government agencies and so on are often the very ones who need that program and who become our chronically unemployed.

I do not know and have not asked for a breakdown by background. I simply want to know who they are, where they are from and how to locate them so that we can get to them and design the programs with enough flexibility so we can access those young people. However, that question particularly outlines the core of this problem, which is not simply to pretend that, by having a major program, one has got to the core of the problem.

I feel one of the problems with many of these programs is that there are the same young people coming in and out of the program. One pretends one has created jobs when, to be fair, there have been people coming back into a program. One has also dealt with people who had a far better chance of getting employment outside some of these programs than one otherwise wanted to. Therefore, we want to focus those programs.

As much as I would like to be able to have those kinds of programs with us today, I must tell the member that we do not. We are not going to waste money in the meantime, simply to solve political pressure, to have an announcement to make with regard to job creation. We are going to save our money, husband it and use it properly to invest in those kinds of young people with particularly difficult problems.

Mr. Peterson: This is not political pressure; this is real human pressure. Surely the minister has to see it in those terms for a change.

The only reference he made to any statistical analysis about unemployment was that he said, "Unemployment rates are projected to remain high." Could he please tell us what those unemployment rates for the next year will be? What is he prepared to live with, both in the total area as well as in the youth area? What are his objectives as the Treasurer? What is he doing with this economic forecast? What are his targets? How many young people does he want to put back to work? These are the questions and they should have been included in his economic forecast.

Hon. Mr. Grossman: Our target was included in our economic statement. It is full employment.


Mr. Wrye: Mr. Speaker, my question is to the Minister of Colleges and Universities. After a delay of some two and a half years following the release of the final report of the Committee on the Future Role of Universities in Ontario, the minister appears today to have enunciated her own solution to the challenge that was set out by the Fisher committee.

In doing so, she appears to have rejected three historical tenets of our post-secondary university system: first, the full accessibility to all fully qualified students; second, the tenure system, which has protected academic freedom over the years; and third, the tenet that we would offer every university student a course of his own choosing at a university in his community, at least in the undergraduate system.

Given the discussions on rationalization which she proposed today, the minister obviously got no approval from the universities; she was not able to reach an agreement with them. Given that opposition, how can she propose this kind of an attack on the historical development of our university system in Ontario?

Hon. Miss Stephenson: Mr. Speaker, first, the honourable member is quite wrong, as usual. We have not rejected any of the principles, except that one of the principles he enunciates is incorrect. We have always said there would be a place within the university system for every young person who could benefit from that education. However, there has never been a promise that it would be in the course of his choice.

I challenge the member to find that because it is not, nor has it ever been, a tenet of any government that I know of to support a university system, nor of any university system anywhere in the world. We have not rejected any of the important tenets related to the university system.

We have asked a knowledgeable commission, made up of people who have very real concern about the university system, to examine all the matters -- all the input that has been developed around the Commission on Post-Secondary Education in Ontario and around the CFRUO reports, preliminary and final, as well as all the input that has been developed for the annual hearings of the Ontario Council on University Affairs -- and following the kinds of broad-brush guidelines that have been presented, to establish a blueprint for the restructuring of the university system to preserve its integrity and its excellence.

Mr. Wrye: The minister talks about broad-brush guidelines. Let me ask her whether I can get a commitment on one aspect which may be a little more important than a guideline. In her statement, she said, "I also believe this plan for tomorrow can be accomplished without reducing the number of universities in Ontario, although fundamental changes may be necessary to some or all of the institutions."

Given that statement, may I ask her to give us a firm commitment in this place today on two matters: one, that no university in the system will close and that she will instruct the commission to prepare its work with that commitment as a guiding principle; two, a firm commitment that no young person will be limited in choosing a university by inaccessibility of a program in a community university near to the community where the student happens to be lucky enough to grow up?

Hon. Miss Stephenson: I think the honour- able member is being obtuse in his first request because that is already a part of the guidelines, and unreasonable in his second because I doubt anyone could ever provide that kind of guarantee in any kind of civilization anywhere. We shall do our very best to ensure there are places. I am not trying to destroy anything. I am trying to ensure that there will be places for every young person who could benefit from a university education in a university in Ontario.

Mr. Allen: Mr. Speaker, the university system has been under a system of constraint for a decade and serious constraint for half a decade. That has had very serious consequences for the programming, the quality and the research in that system. That is now impacting seriously upon real accessibility. The college system is itself immensely overflowing and overfull.

How can the minister maintain that floating this kind of restructuring -- which really is virtually a university of Ontario, which has been rejected in the past, in another guise -- and argue that such system will maintain any of the objectives she ascribes to it in terms of excellence when it is simply constraint and restraint continued?

Hon. Miss Stephenson: Mr. Speaker, in the last three years the universities in this province have received increases in their operating grant allocations significantly beyond the rate of inflation, significantly higher last year than in any other province in Canada, and I believe significantly higher this year as well than other provincial jurisdictions. I believe it is possible that money does not solve all the problems, but that indeed one needs to think what one is doing from time to time.

I reject totally the idea proposed by the honourable member that what I am proposing to do or proposing to ask the commission to do is to establish a university of Ontario. That is not the proposal. It states clearly in the paper, if he would read it, that this has been rejected in Ontario and continues to be rejected.

It is quite clear that we have asked the commission to look carefully at the university system and to provide us with the blueprint which it thinks is appropriate for the further development, expansion and improvement of the university system in Ontario.

Mr. Wrye: Given that the minister has given such definite guidelines, and given that she has offered the commission as a starting point so many historical papers and background papers, I wonder whether the commission's role is to do its own independent study and to develop its own new stream of information, or is this commission to be headed by Dr. Watts supposed to be just a rubber stamp for the direction the minister has tried to get the university presidents to accept and which in their wisdom they have rejected?

Hon. Miss Stephenson: First, Dr. Watts is not the chairman of the commission. Second, if the honourable gentleman knows either Dr. Watts or Dr. Mustard, he would have his tongue in both cheeks in ever suggesting those two eminent gentlemen would follow the direction of anyone except their own intelligence, which is superior, to say the least.

3:50 p.m.


Mr. Rae: Mr. Speaker, my question is to the Treasurer. He may recall that in November 1980 the then Treasurer, now the Minister of Industry and Trade (Mr. F. S. Miller), brought in an economic stimulus package. At that time unemployment was much lower. It is now 37 per cent higher; youth unemployment is 31 per cent higher; for those 55 and over it is 75 per cent higher; the average length of unemployment is up from 14 weeks to 20 weeks, and those who are unemployed for over a year are up from 48,000 to 100,000.

If it was the right thing for the government to provide a stimulus for the economy in 1980, when the situation was serious but by no means as serious as it is today, how can the Treasurer justify going into the winter with absolutely no supplemental measures either on the tax side or on the spending side for jobs to help those people who are now left literally without any kind of hope, thanks to the absence of any concrete assistance in this statement today?

Hon. Mr. Grossman: Mr. Speaker, one can ask this question daily, but the fact is, as I indicated earlier, that the very same Treasurer not only had a very fine mini-budget in the fall of 1980 but also had a very good budget in the spring of 1983. Many of the tax changes in there, many of the measures with respect to capital acceleration programs and the youth employment programs, are coming on stream now.

That puts a different context on coming into the winter. That is why there is a significant difference between having decent long-term job creation programs and trying to respond to political circumstances as we come into this time frame. The reality is that the programs were mounted at a reasonable time to allow a workup, particularly in capital projects, which are now well under way and hiring people. The youth employment program is funded and hiring people.

One should not confuse the coming on stream of programs, the uptake of programs and the filling of jobs by our young people and all of our people with the political announcements with regard to when those are coming on stream. Those seeds were planted last May and they are producing jobs now, so we are addressing those problems right now.

Mr. Rae: The minister wants to talk about things that are going on stream; I will tell him some things that are going off stream, like the Canada-Ontario employment development program, which the minister participates in with the government of Canada. In December 1983, 1,633 projects are scheduled to be completed and over 12,000 jobs will come to an end.

Mr. Speaker: Question, please.

Mr. Rae: Next month 143 are coming on stream; that is compared to 1,633 that are being cancelled or are ending. So let us talk about the reality here. For all those things the minister vaguely talks about coming on stream, there are some specifics for some things that are in fact going off stream.

What is the minister going to do this winter for those younger people and those older people who have been left aside by his government and by the Liberal government in Ottawa? How can he justify doing nothing, which is what he has done in this statement, about employment prospects for those people this winter?


Mr. Speaker: Order, please. I have to caution our guests in the gallery not to demonstrate or take part in any kind of disruption or I will have to clear the galleries.

Mr. Roy: He has already started doing that. He is already taking them out.

Mr. Speaker: I see that.

Hon. Mr. Grossman: The COED program, we feel, was a successful program. We just added some additional funding -- through the Board of Industrial Leadership and Development, I might add; a program the member opposite likes to criticize all the time -- to top up some of those activities under section 38. I would make it clear that we have agreed with the federal government that we will use the same type of format -- that is, unemployment insurance and Canada assistance plan moneys -- in order to continue the flow of new jobs into the economy.

The member does not want to acknowledge that there are jobs coming on. I will acknowledge to the member that the COED program is winding down; it is because of this that we encouraged the federal government to maintain the COED program at all times and indicated our willingness to continue our share of the funding in that regard. They have declined. To be fair, they have agreed to undertake these new programs with UI and CAP. Negotiations are now going on in that regard.

We are assessing our youth employment programs and all of our job creation programs to see what might be appropriate over the next few months. I indicated in my statement that there will be some things in the next few weeks. I also indicated in my statement that I am not going to produce programs that simply give someone a paycheque for a few weeks and pretend we have solved that problem.

I am being quite clear. I am going to use those resources to create important, decently paid. creative, experience-providing, training-providing jobs. With all due respect, that takes a lot more forethought than standing up and saying: "Why do you not just put them all on the public payroll? Why do you not just use the money and get some people out there?"

Mr. Foulds: He did not say that. What kind of nonsense is that?

Mr. Rae: You have not read anything we said over the past two weeks.

Mr. Speaker: Order.

Hon. Mr. Grossman: I read the member's silliness in his press release.

I am prepared to stand here as long as necessary to defend the proper investment of funds and not jump into throwing away dollars which will not come back in terms of good, long-term investments. When we make those investments they are going to be right. If that takes some time, so be it, but in the meantime, while we are waiting to develop those programs and working hard on them, we will make sure of the continuation of our old projects. We will make sure the Ontario career action program and others are properly funded so that no one can accuse us, although the members will want to, of neglecting the program.

I am not going to throw millions of dollars away just to be able to say I have created some more jobs this winter. I will not do it.

Mr. T. P. Reid: Mr. Speaker, the less the Treasurer does, the longer his answer is.

Does the Treasurer understand that many of the 155,000 unemployed young people out there have never had much of a job, if any job at all? They are not eligible for unemployment insurance, they have no other way of supporting themselves and they do not have any work experience that will allow them to get long-term jobs. They need help and jobs now for 12 weeks, 20 weeks or longer.

Surely it is his responsibility not to talk long-term or short-term for these people who are in need. He can take our program, he can take the credit for it, but let him do something for the 155,000 young people who need something now.

Hon. Mr. Grossman: Mr. Speaker, let us talk about the 155,000 people. Let us remember exactly what the member said and what his leader said a moment ago: "Sure, we can talk about creating 100,000 jobs for our young people but that only translates into 35,000 or whatever."

Mr. T. P. Reid: That is better than none.

Mr. Speaker: Order.

Hon. Mr. Grossman: The fact is that 100,000 young people got experience because of this government this year. There are 155,000 unemployed youth in total right now. The member can be sure he will not find a government that can say of 155,000 young people today that it provided employment and experience for 100,000. There is no question about that fact. That is exactly what we have been doing.

Mr. Rae: Would the minister care to explain how, if he was able to announce transfer payments to institutions, he was not able to announce today any increase in transfer payments to senior citizens who are retired? Of particular concern are those senior citizens and those single senior citizens who are living alone, who are in receipt of the guaranteed income supplement, guaranteed annual income system benefits and old age security and for whom that is their only income.

Every major study that has been done by this Legislature and by every group that is advising the government has said that they are willing to let it go. The parliamentary assistant to the Premier, the member for Scarborough East (Mrs. Birch), stated a year ago that she approved of the $100-million increase that would allow a single person to receive a fairer share in comparison to what a married couple gets.

Mr. Speaker: Question, please.

Mr. Rae: If the minister is able to announce transfer payments to institutions, why is he not able to announce transfer payments to single elderly people who are living in poverty in Ontario?

Hon. Mr. Grossman: We will undertake our reviews, we are undertaking our reviews and we will make our announcements at the appropriate time. The issues the member raised are ones --


Mr. Speaker: Order.

Hon. Mr. Grossman: -- which were raised many months ago on this side of the House by my colleague the former Provincial Secretary for Social Development (Mrs. Birch) and by the Deputy Premier (Mr. Welch), to name just two.

Mr. McClellan: So where is the money?

Mr. Foulds: Where are your answers?

Mr. Speaker: Order.

Hon. Mr. Grossman: The cameras are gone. The members can stop interjecting now.

I have said publicly I agree that the kind of recipient the member is talking about, the single elderly person, is our first priority and we have to address that problem.

4 p.m.

We have also said that we have to wait to see what federal enrichment is coming and the federal government has announced that enrichment. When that enrichment is forthcoming, we will see how much it is and we will make the appropriate adjustments. That is the responsible way to do it.

In the meantime, I admit, the members have the luxury of posturing as if only they care about the seniors. But we have the responsibility of making those decisions at the appropriate and responsible time and we will make them. The seniors in this province are better looked after than the seniors anywhere in this country or in North America, and the member knows it.

Mr. Rae: The government has reviewed and studied the matter to death and I am going to be talking about its record for a long time to come in my constituency.

Mr. Speaker: Question, please.

Mr. Rae: Senior citizens are not quite as impressed as the minister might choose to be by the kinds of services he is offering. He should be ashamed of the kind of thing he is not doing for senior citizens. Talk about the conditions some people are living in, thanks to his inactivity.


Mr. Rae: Mr. Speaker, my second question to the Treasurer has to do with the announcement made yesterday by Mr. Jake Epp, the federal Conservative Party health critic, with respect to the support from the Conservative Party for the proposals made in the Canada Health Act.

Given the fact that Mr. Mulroney's party in Ottawa has now come out against extra billing and given the fact that both the opposition political parties in this province have come out against extra billing, why is the Treasurer still going around this province threatening to increase either health care premiums or some other form of personal taxes by as much as $60 million to $100 million just to preserve the privileges of a very few doctors who insist on their right to charge the patients of this province more than has been negotiated with their government?

Hon. Mr. Grossman: Mr. Speaker, the member can repeat that proposition many times, but if he will watch what we have said, we have not said that is what we are going to do. We have said we are looking at the situation and need some information, some hard facts, some consultation before any decision is made. If the member read --

Mr. Rae: What a change of tune. What happened now? What conversion did the minister go through in the past week?

Mr. Speaker: Order. Supplementary --

Hon. Mr. Grossman: With respect, the leader of the third party has been making speeches. I have not answered the question yet and I am --

Mr. Speaker: That is quite right, but I am not sure they want an answer and I would like to hear the supplementary, please.

Hon. Mr. Grossman: You may be right on that one.

Mr. Speaker: Supplementary, please.

Mr. Rae: The minister is talking an entirely different language this week from the language he has been talking across Canada and certainly in Ontario in the last year with respect to extra billing. I do not know what has happened to him. He seems to be an individual transformed --

Mr. Speaker: Question, please.

Mr. Rae: Perhaps it was a transformation as a result of a phone call from his federal leader, Mr. Mulroney, whom all these other people seem to be wanting to join in the next federal election --

Mr. Speaker: Question.

Mr. Rae: My question to the minister is quite clear. He has a copy of the Canada Health Act. He knows what it says. Is he going to be increasing taxes or premiums in this province as a result or is he not?

Hon. Mr. Grossman: I have made it clear that we have to find out what is contained in the federal government's intentions. That includes the specific and important distinction between the position taken by the Leader of the Opposition in Ottawa and the government in Ottawa.

Let us look at the differences. One, the Leader of the Opposition in Ottawa believes in and practises consultation with the provinces.

Mr. Rae: So the Tory health act will be different from the Liberal health act.

Mr. Speaker: Order.

Hon. Mr. Grossman: Two, the Leader of the Opposition in Ottawa has made it quite clear that he understands the fundamental problem with the health care system is funding.

Mr. Rae: I love this. This is rich.

Hon. Mr. Grossman: Lest the leader of the third party wants to rehear his own words in addressing the funding of the health care system, I have --

Mr. Rae: I have addressed that question many times.

Hon. Mr. Grossman: Yes, I have a full body of deathless quotes by the honourable member.

Mr. Speaker: I think the minister has answered the question fully.

Hon. Mr. Grossman: Mr. Speaker, with respect, I have not provided an explanation.

Mr. Speaker: I think you did very well.

Hon. Mr. Grossman: That is okay with me.

Ms. Copps: Mr. Speaker, if the minister is serious about the discussion he intends to have prior to taking his new position, I wonder if he could explain to this House why in an interview on The Journal recently, when discussing the issue of extra billing, he cited a percentage of extra billing in this province which was in direct contradiction to what was said by his own Minister of Health (Mr. Norton) during estimates in the Legislature that day.

I wonder if the minister either does not know the extent of the problem of extra billing or is prepared to distort the facts on national television because the facts, as he presented them, were decidedly different from the facts presented in this Legislature by his colleague this week.

Hon Mr. Grossman: (a) The honourable member is incorrect; (b) that is not a supplementary question; (c) that is not a question which relates to my ministry; but (d) I will repeat (a), she is totally incorrect.

Mr. Cooke: Mr. Speaker, I would like to ask the Treasurer, in view of the many cases that have been brought forward to this Legislature of people on ordinary middle and low incomes, fixed incomes, who are being hurt by extra hilling -- in fact, Dr. Moran of the Ontario Medical Association says they are getting 300 calls per month from people who are desperately looking for opted-in rates because they cannot afford extra billing -- is this government going to outlaw extra billing in the province or not?

Hon. Mr. Grossman: As we have said each and every time the issue has been discussed since the Canada Health Act was introduced, we are waiting to understand more fully what lies behind that act in the regulations to get more information and to make appropriate decisions at that time. We have made that clear from the start.


Mr. Eakins: Mr. Speaker, my question is to the Minister of Tourism and Recreation. The minister is well aware that, after Ontario residents themselves, Ontario's largest tourism market is the United States both in terms of visitors and revenues it brings into the province.

According to Statistics Canada, Ontario is heading for a record tourism deficit this year because of declining numbers of US visitors. I might add, according to the new Ontario travel survey the minister just released yesterday, Ontario's percentage of US tourists visiting Canada has declined. In other words, when American tourists visit Canada now, fewer are choosing Ontario as their destination.

I would like to know what specific measures the minister intends to take to recapture this market and its attendant revenue, especially in view of the fact that next year is a presidential election year in the United States, which has always tended to keep Americans at home, and the Olympics will be in Los Angeles and the world's fair in New Orleans.

Hon. Mr. Baetz: Mr. Speaker, to expand our tourism market from the United States, we will continue next year to do many of the things we are doing at the present time, but we will probably be doing something more about it. For example, we are certainly going to be stepping up our advertising program in the United States. We are going to be talking much more to the Americans about the fact that they can have a tax rebate on goods purchased in this country. We will make that fact better known to them than maybe it is at the present time.

We are certainly going to be talking a great deal about the bicentennial celebrations that will be taking place here. A lot of the Americans, especially those in neighbouring states, are very much interested in this. No doubt we are going to be talking a great deal about the papal visit, which certainly is going to inspire many Americans to come over here, and we will also be talking about the royal visit here. As I announced yesterday, we are going to be encouraging our private operators here, the people who run the resorts and lodges and so forth, the restaurants and hotels, through better loan guarantees and interest subsidies, a program I announced yesterday.

Frankly, I am very confident our portion of the American tourism dollar is going to increase very substantially next year.

4:10 p.m.

Mr. Eakins: Is the minister aware of the campaign originating in the state of Michigan with car bumper stickers saying: "Say no to Ontario. Say yes to Michigan." It refers to the increase in the cost of nonresident fishing licences by the Minister of Natural Resources (Mr. Pope). Not that we are against it, but in view of the state of tourism, does the minister not see this increase as poorly timed? Does he not see there is little point in spending all the money he does to promote the province if the effect is just going to be cancelled by another minister's poorly timed decision?

Hon. Mr. Baetz: As the member has indicated, the decision to increase the nonresident fishing fees is the responsibility of the Minister of Natural Resources, but I do want to assure him and everybody else over there and on this side that that minister certainly did consult very closely with us.

I frankly think this campaign on the bumper stickers, "Say no to Ontario," is a very isolated kind of campaign; it does not really amount to a great deal. I can also assure the member that even at this time both the Minister of Natural Resources and I are increasing our talks with our American neighbours to assure them not only that they are welcome here, but that the fishing licence fees are going to be equitable.

Mr. Stokes: Mr. Speaker, I would like to ask the minister if he got the distinct impression that the member for Victoria-Haliburton was against Ontario getting fair economic rent for its resources.


Mr. McClellan: On the one hand and on the other.

Hon. Mr. Baetz: On the one hand and on the other, yes.

In view of the fact that Canadians as residents of Ontario are paying through their taxes to help keep our sports fishing a very live occupation, I do not think we should be giving any visitor from outside the province a free ride for that. So there is some equity in charging some nonresident licence fees. I appreciate the question being raised.


Mr. Mackenzie: Mr. Speaker, I would like to ask a question of the Minister of Labour in the absence of the Premier (Mr. Davis). This morning 93 more Hamilton workers got their Christmas present, a number of them friends of mine. The Bridge and Tank Canada division of York Russel Inc. announced -- and I might say that over half the work force has more than 15 years' seniority in that plant -- that its doors will be closed for good on February 17.

As of last night the Ministry of Labour had no knowledge of this closure. This firm, in business for better than 120 years in Hamilton with versatility and a skilled work force, is one of some 19 companies that have been purchased by York Russel Inc., owned by the Tanenbaums in the last 10 years, many of which are now being disposed of through the corporate rationalization process.

Mr. Speaker: Question, please.

Mr. Mackenzie: Would the minister not agree that we desperately need tough plant closure legislation in Ontario to allow the light of publicity for the workers and their communities on what is actually going on in plant closures in Ontario?

Hon. Mr. Ramsay: Mr. Speaker, when the honourable member states that the ministry had no knowledge of this, I believe he is referring to the fact that when he approached me yesterday afternoon I had no knowledge of it. It is not correct to say our ministry had no knowledge of this particular closure.

Mr. Mackenzie: Do they not talk to you?

Hon. Mr. Ramsay: I happen to have worked in the very industry he is referring to a number of years ago. I am well aware of Bridge and Tank Canada; I am well aware of the expertise of the employees there, and I can certainly relate to the circumstances surrounding this closing as well as the closing of many other industries and plants across this province.

The member and I have had many discussions. In fact, I do not think he loses an opportunity each day -- and I commend him for it; I am not being critical of it in any respect -- to send me a note across the aisle and remind me of the fact that, in his opinion, we need disclosure of information in this province.

I only have to say, with the greatest of respect, I feel it would be a deterrent. I do feel, however, we have to do everything we can to consult, negotiate, attempt to rationalize these decisions and so on, but I just do not feel it would be productive. I do not feel it would save any jobs, and that is the key to the whole matter, to have legislation in effect that would require disclosure.

Mr. Mackenzie: I find it strange after the nonsense we got this morning about the recovery that we have tens of thousands of employees out there out of work, and the number being added to almost every week. What is the deterrent? Can the minister tell us why it would not help to have some dialogue in public as to the reasons for it? What is going on? Are firms being milked? What is happening?

Surely to goodness, it is time to re-establish the plant shutdowns committee with specific instructions to take a look at legislation which exists and which is superior in many European countries in terms of protection of workers. Surely the minister should be prepared to re-establish a committee, the plant shutdowns committee or some mechanism, to take a look at what is happening to industrial workers in Ontario.

Hon. Mr. Ramsay: I do not have to be lectured by the honourable member from across the aisle.

Mr. Laughren: It seems you do.

Hon. Mr. Ramsay: Let me tell that smart fellow something.

Mr. Speaker: Never mind the interjections, please.

Mr. McClellan: Go ahead, have a temper tantrum.

Mr. Rae: Blow a fuse. That will help a lot.

Hon. Mr. Ramsay: I am not going to blow a fuse. I am simply going to tell the honourable member opposite who made that snide, sarcastic, uninformed remark that I have a son who is an industrial worker. He has two small children and is involved in a plant closure. So do not give me any of that stuff.

Mr. Laughren: That is all the more reason to start doing something.

Mr. Rae: That is the most pathetic thing I have ever heard.

Mr. Mackenzie: Tell us what it proves.

Mr. Speaker: Order. Surely I do not have to point out to all honourable members that the standing orders say clearly that all interjections are out of order and are not to be entertained.

Ms. Copps: Mr. Speaker, my supplementary question relates to the fact the minister has discussed in this House in the past and is at present investigating the issue of first right of refusal. Since he is familiar with this situation, he will know that after the workers are laid off on February 17 the parent company, York Russel, does have other plants, at least one of which is also involved in fabricating products.

I wonder if the minister could advise us whether he will be bringing in first right of refusal legislation prior to that date so that at least those workers will be covered by the legislation which did not cover the workers at Consolidated-Bathurst.

Hon. Mr. Ramsay: Mr. Speaker, we have put out a discussion paper on preferential hiring. Many submissions have come in on it from management and labour and we are looking at it carefully. One effect that discussion paper has had is we have not had a circumstance since we put it out where anybody has refused to give preferential hiring. In a sense, the discussion paper has been effective, although we have not brought forward any legislation.

I want to digress for a moment simply to say, perhaps in less emotional terms, that if I truly believed disclosure information would save a single job in this province, I would be pleased to bring it forward to this Legislature.

4:20 p.m.


Mr. Van Horne: Mr. Speaker, I will direct this question to the Treasurer in the absence of the Minster of Industry and Trade (Mr. F. S. Miller).

This question really is a follow-up to the question my leader asked a week ago on Tuesday about the lending policies of the Ontario Development Corporations as agents of regional development. As a follow-up question, I would like to ask the minister how, after examining the figures for loan and guarantee commitments over the last eight years or so, he can expect anyone to reach a conclusion other than that there has been an extraordinary decline in support for economic development in northern Ontario through the Northern Ontario Development Corp.

Hon. Mr. Grossman: Mr. Speaker, this cannot be sustained by the facts. I happen to be somewhat familiar with NODC, although the member would have to ask the Minister of Industry and Trade for specific details. In my role as chairman of the Board of Industrial Leadership and Development, I can tell him that a great number of dollars have flowed to northern Ontario.

Many of those dollars have flowed through the pulp and paper agreement, for example. If we had not done that, there would have been a requirement to flow very many more thousands of dollars, millions of dollars, in social support programs. Let us look at all the industrial support being provided. The pulp and paper program cost us about $130 million -- a lot of money. It levered a $1.5-billion investment, most of that in northern Ontario.

If one looks at the NODC program over the full course of NODC, which is now 11 years old, I guess, with preferential rates for people in the north, one will find that northern Ontario on a population breakdown has done very well indeed. When one adds to that the BILD program, which has done a great deal for the north, one finds an array of industrial programs, an amount of money flowing to northern Ontario that is, to be fair, unparalleled.

Mr. Van Horne: The information I have may interest the minister. Since 1974-75 the commitments made by NODC have decreased from almost $24 million to less than $11 million. Over the same period ODC commitments in southern Ontario rose from $40 million to $57 million. That information was also passed on by my leader last week. That is a 55 per cent decline in the north and a 40.7 per cent increase in southern Ontario.

If we accept the argument by the minister or his successor that the 1974-75 commitments were abnormally high, using 1975-76 as a comparison provides equally startling results. In real dollars northern Ontario suffered a 24.3 per cent decline in commitments while southern Ontario received a 207.5 per cent increase. By any measure, the north has been getting the short end of the stick.

Is this obvious decline a reflection of a policy the minister approves, and does he intend to let this disheartening trend continue?

Hon. Mr. Grossman: At present, not by accident, there is something like $5 billion worth of capital projects going on in northern Ontario. This is not an accident; it has very much to do with the policies of this government, including NODC. I remind the member that many of the capital acceleration programs of this government are occurring in northern Ontario. It is fair to point out that those rates are reflective of a lot of things, including private sector growth in some of those areas.

They also reflect things such as the Ontario Centre for Resource Machinery in Sudbury. Let us talk about that centre for a second. Funded by BILD with several million dollars, it is in turn using that money to reinvest in high technology and growth businesses throughout the north. There are at least half a dozen projects under way in the north, one of which is providing manufacturing jobs in the great community of Sault Ste. Marie. Unless the member totals in the very important investments being made just by that one new vehicle, the Ontario Centre for Resource Machinery, then a very fair picture is really not being given. The centre is investing all its funds in northern Ontario.

If the member wants a fair analysis of the amounts of development dollars being added to the north, he will have to take the pulp and paper programs, the employment development fund programs, the BILD programs, the Ontario Centre for Resource Machinery, the capital acceleration programs of this government, the youth employment programs, the Canada-Ontario employment development programs, many of which were handled by my colleague the Minister of Natural Resources (Mr. Pope) to make sure they ended up in the north, and NODC, to get the full package.


Mr. Wildman: Mr. Speaker, I have a question for the Minister of Education regarding a very ominous prospect for education for francophone students from Dubreuilville and Wawa in my riding.

Is the minister aware that the Michipicoten Board of Education this week passed a resolution stating that as of June 1984, that board will no longer accept nonresident students from Dubreuilville at the Michipicoten high school? If she is aware of that, what intervention is the ministry prepared to make to ensure secondary school education for the students of the community of Dubreuilville?

Hon. Miss Stephenson: Mr. Speaker, I have not received that resolution from the Michipicoten board. It certainly would be an unfortunate situation if the boards of the province determined that they were not about to accept nonresident students from various other boards as students within their systems. I will certainly look at this resolution and try to see whether there is a way in which we can sort out the problem.

Mr. Wildman: I appreciate the minister's response. When she is investigating it, I hope she and her officials will attempt to determine whether this is an overt attempt by the Michipicoten Board of Education to avoid the new policy announced by the minister with regard to francophone education in Ontario and with regard to the provision of francophone trustees for a board of education whose student body is more than 10 per cent francophone.

Hon. Miss Stephenson: If it is, it is a somewhat circuitous and premature activity, because later this afternoon I shall be introducing the amendments to the Education Act. These amendments will ensure that wherever there is an anglophone child in the province, the board must provide an anglophone education; where there is a francophone child, the board must provide a francophone education.

There is no final decision as yet about the mechanism for assured representation for governments. That is being discussed by a group of trustees, all of whom have come together voluntarily -- I think there are 10 altogether -- and representatives of government. Those discussions will be going on in January and February to finalize the structure that will be put in place to ensure there is a greater degree of French-language governance of French-language education.

Mr. Roy: Mr. Speaker, in view of the minister's statement about the introduction of this legislation this afternoon -- which is an initiative we wholeheartedly support -- I just wonder about her suggestions about the representation of French-language trustees, which have been rejected by all school boards that may be involved with that proposal.

Given the rejection by all the boards and the consistent demand by such boards as Ottawa and Carleton that instead of this complicated structure of representation, the minister should set up a French-language school board, why does she not accept that and make that decision, which is the only logical solution for areas such as Ottawa and Carleton?

Hon. Miss Stephenson: Mr. Speaker, I must admit that I admire the so-called logic of the member for Ottawa East (Mr. Roy). None the less, I must remind him that the 20 boards which were involved or which would be directly affected by the proposal did indeed bring forward six alternative proposals to be discussed within this bipartite group, which is now being established. There are other boards besides Ottawa and Carleton in Ontario; in fact, there are many boards besides Ottawa and Carleton in Ontario.

I certainly do hope that with the help of these thoughtful people who have agreed it is important that the language of instruction in the official languages of Canada be available to the students of Ontario -- and who feel strongly that this right should be a part of the Education Act -- we will come to the appropriate conclusion about the right kind of governance of French-language education.

4:30 p.m.


Mr. J. A. Reed: Mr. Speaker, in the absence of the Premier (Mr. Davis) and the Provincial Secretary for Resources Development (Mr. Sterling) and because of the urgent nature of this question, I am going to ask it of the Minister of Natural Resources, if he would be kind enough to bear with me, because I believe he is a party to what is unfolding at this time.

My question concerns the responsibility of the province in the matter of the mercury pollution damage inflicted on the Grassy Narrows Indian band and the fact that the companies responsible -- that is, Reed Paper initially and Great Lakes Forest Products, who assumed responsibility and were parties to the mediation process which the Premier established in 1978 -- have yet to make an offer for damages to the band.

Is the minister aware of the letter that was sent yesterday by Great Lakes to the Ontario Indian commissioner stating that they are now refusing to make any offer to the band, even though they had made a commitment to do so, on the basis that they are actively pursuing the matter of health claims with the Premier? Is this the case? Can the minister confirm to us that the holdup to a settlement has been the question of lowering the $15-million provincial cap for liabilities? Can the minister assure us that this cap will not be lowered?

Hon. Mr. Pope: Mr. Speaker, to say the matter is in the hands of the Premier is not accurate. I do not think the Premier has control over the process or the timing of any settlement. The Premier tried to get the parties together, tried to expedite a settlement on behalf of the band and negotiations between Reed and Great Lakes, and tried to use his good offices to do so in a positive manner.

It has still to be determined what the respective contributions or liabilities between Reed and Great Lakes are vis-à-vis each other -- not vis-à-vis the band, but vis-à-vis each other. I am aware of meetings that have been held in England and in Ontario between those two companies in an attempt to sort it out. However, I do not believe any conclusion or settlement has been reached between the two companies at this time, and I do not think the fault for any such problem lies with this government or with the Premier.


Mr. Speaker: Just before proceeding, I would like to point out to all honourable members and ask them to join with me in recognizing an old friend of ours --

Mr. Breaugh: What do you mean "an old friend?"

Mr. Stokes: She is not an old friend; she is a good friend.

Mr. Speaker: A friend of long standing, perhaps; right. She happened to be first female clerk in the Ontario Legislature, Frances Nokes.



Mr. Treleaven from the standing committee on procedural affairs presented the committee's report and moved its adoption.

Mr. Treleaven: Mr. Speaker, as chairman of the standing committee on procedural affairs, I have the honour to present to the House the committee's seventh review of agencies, boards and commissions.

Last September, the committee reviewed the Ontario Status of Women Council, the Ontario Manpower Commission, the Ontario Cancer Treatment and Research Foundation, the Law Society of Upper Canada and the Criminal Injuries Compensation Board.

After careful deliberation, the committee has produced a consensus report with recommendations it feels will improve the operation of the agencies reviewed by the committee.

The committee looks forward to a debate in the next session on the recommendations in the report and the responses of the ministers responsible for these agencies.

On motion by Mr. Treleaven, the debate was adjourned.


Mr. Kerr from the standing committee on regulations and other statutory instruments presented the following report and moved its adoption:

Your committee begs to report the following bills without amendment:

Bill Pr30, An Act to revive the Malton Memorial Recreation Association;

Bill Pr52, An Act to revive Teco Mines and Oils Limited;

Bill Pr53, An Act respecting the City of Owen Sound.

Your committee begs to report the following bill with a certain amendment:

Bill Pr51, An Act respecting the City of North York.

Motion agreed to.

Mr. Kerr from the standing committee on regulations and other statutory instruments presented the committee's third report and moved its adoption.

Mr. Speaker: Does the member wish to make a statement?

Mr. Kerr: Mr. Speaker, I have no comments except to suggest that all members read the report thoroughly over the Christmas recess.

On motion by Mr. Kerr, the debate was adjourned.


Mr. McLean from the standing committee on general government reported the following resolutions:

That supply in the following amounts and to defray the expenses of the Ministry of Industry and Trade be granted to Her Majesty for the fiscal year ending March 31, 1984:

Ministry administration program, $8,380,500; industry program, $18,928,000; trade program, $14,836,000; Ontario Development Corporations program, $32,284,000; technology centres co-ordination program, $649,000; and

That supply in the following supplementary amount and to defray the expenses of the Ministry of Industry and Trade be granted to Her Majesty for the fiscal year ending March 31, 1984:

Trade program, $1,376,000.



Hon. Miss Stephenson moved, seconded by Hon. Mr. Welch, first reading of Bill 157, An Act to amend the Education Act.

Motion agreed to.

Hon. Miss Stephenson: Mr. Speaker, this bill contains a number of amendments covering a variety of matters in the Education Act, some of a purely housekeeping nature and some involving relatively limited but necessary changes to the act.

I remind members that on March 23, 1983, the government issued a paper proposing a number of changes to part XI of the Education Act, which deals with French-language instruction. One of the proposals contained in that paper was that French-speaking pupils should have the right to receive their education in French, regardless of numbers, with board, lodging and transportation provided to make that possible where necessary.

Another of the proposals was that where a dispute cannot be resolved by the Languages of Instruction Commission of Ontario, there should be provision for the commission to make a recommendation to the minister and for the minister to make an order binding on the board concerned.

The provisions of this bill implement these two proposals.

4:40 p.m.


Mr. Foulds moved, seconded by Mr. Philip, first reading of Bill 158, An Act to ensure the Regeneration and Reforestation of Forests in Ontario.

Motion agreed to.

Mr. Foulds: Mr. Speaker, this bill, first proposed in June 1980, would make it a legal and legislative requirement by the government (1) to manage the forests on a sustained yield basis; (2) to do a complete inventory of the forests; (3) to make public a forest management plan for the entire province every five years; (4) to describe the extent of forest land in Ontario that has been denuded and not restocked; and (5) to outline a five-year plan for restocking and improving forest lands in Ontario and the cost of this program.


Mr. Foulds moved, seconded by Mr. Philip, first reading of Bill 159, the Insect Emblems Act, 1983.

Motion agreed to.

Mr. Foulds: Mr. Speaker, this act would make the blackfly the official provincial insect for northern Ontario and the mosquito the official provincial insect for southern Ontario. There was tough competition in both categories from the termite, the grasshopper, the spruce budworm and the common house fly. However, detailed provincial-wide polling has shown clearly that the blackfly and the mosquito are popular choices by more Ontarians than any other insect in the designated parts of the province.

This bill should go down in history alongside the legislation of the Minister of Natural Resources (Mr. Pope) to make the white pine the official tree of Ontario and the attempt of the member for Hastings-Peterborough (Mr. Pollock) to make the blue jay Ontario's official bird.

I hope this bill will be passed during the course of Ontario's bicentennial to show the strength and determination of Ontario's people, who have triumphed over many past and present adversities.

Mr. Speaker: Are you recommending that this be given serious consideration by the House?

Mr. Cureatz: Mr. Speaker, on a point of order: I would like to point out to the honourable member that he forgot the member for Northumberland (Mr. Sheppard), who is trying to make the pickerel the official fish.


Mr. Foulds: Mr. Speaker, on a point of order: In my announcement about the official insect act, I forgot to give credit to Nicholas Blenkinsop, one of our pages, for the idea.



The following bills were given third reading on motion:

Bill 117, An Act to amend the Telephone Act.

Bill 119, An Act to amend certain Acts respecting Regional Municipalities.

Bill 120, An Act to repeal certain Private Acts related to Municipalities.

Bill 132, An Act to amend the Powers of Attorney Act.

Bill 133, An Act to amend the Mental Health Act.

Bill 134, An Act to amend the Immunization of School Pupils Act, 1982.

Bill 135, An Act to amend the Construction Lien Act.

Bill 136, An Act respecting the Benefits of Provincial Judges and Masters.

Bill 139, An Act to amend the Public Commercial Vehicles Act.

Bill 144, An Act to amend the Retail Sales Tax Act.

Bill 145, An Act to amend the Planning Act, 1983.

Bill 147, An Act to amend the Building Code Act.


Hon. Mr. Wells moved, on behalf of Hon. Miss Stephenson, third reading of Bill 148, An Act to revise the Teachers' Superannuation Act.

Mr. Breaugh: Mr. Speaker, I would invoke standing order 22 and declare a conflict of interest on the bill.

Mr. Speaker: Having done that, does everyone agree to the passage of the bill?

Motion agreed to.


Bill 140, An Act to amend Certain Statutes Relating to the Commission of Offences by Young Persons.

Bill 149, An Act to amend the Provincial Courts Act.

Bill 150, An Act to amend the Unified Family Court Act.

Bill 151, An Act to amend the Provincial Offences Act.

Bill 152, An Act to amend the Proceedings Against the Crown Act.

4:50 p.m.


Resuming the adjourned debate on the motion for second reading of Bill 142, An Act respecting the City of Barrie and the Township of Vespra.

Mr. Epp: Mr. Speaker, I am pleased to be able to continue the discussion on second reading of this bill.

I want to draw the attention of the members to the fact that the annexation the government is requesting of more than 4,500 acres represents a considerable amount of agricultural land which will be urbanized as a result of the annexation to Barrie.

Those of us who have lived in agricultural areas and those of us who have lived only in urban areas appreciate the agricultural land that we have in Ontario. The city of Barrie has just obtained over 8,000 acres -- I understand it is close to 10,000 acres -- of land from Innisfil township and now is seeking almost 5,000 acres of land. This represents a considerable amount of land which the government obviously wants to have urbanized. It underscores the policy that Mr. McKeough announced some years ago of urbanizing that area.

I would have thought that with the concentration these days, by the media and other people, on the kind of policies this government is espousing with respect to urbanization, it would have changed its mind about this. Yet we have here again a policy which underscores the fact that the government wants this area to be commercial, residential and industrial. If that were not the case, why would the government include it in this plan?

Briefly, to summarize the comments I made the other day and the feeling of my party colleagues and myself with respect to the annexation that has been proposed here, we feel very much that this is the wrong step to take. We are going to oppose the bill on a number of grounds.

First, it is going to create more bitterness than has been evident to the present. It is going to represent to the people, particularly of Vespra and of all other small municipalities, an indication that the government does not care about the small municipalities; that it is prepared to have the small municipalities raped, as was evident with respect to Innisfil and more evident with respect to Vespra township, which has fought the annexation for some time, has won by the decision of the Divisional Court but has obviously lost with respect to the government members and the Premier of Ontario (Mr. Davis).

Second, if the government was going to go this route we would have preferred to go by way of the Municipal Boundary Negotiations Act which was set up for this definite, specific purpose. The government obviously does not have confidence in a piece of legislation it has passed and therefore wants to go via direct legislation.

Third, the joint board that is going to be set up to deal with and resolve the problems of remuneration or some kind of restitution for the land and assets Vespra township is going to lose has three strikes against it. In the final analysis if it cannot resolve the problems itself the Ontario Municipal Board is going to resolve them.

We know the Divisional Court found that the Ontario Municipal Board was distinctly biased in favour of one of the municipalities, distinctly biased against one of the municipalities, and therefore Vespra township has no clear indication it is going to get a fair hearing by the Ontario Municipal Board. I propose that the cards are stacked against Vespra right from the start.

Next, even Barrie has asked for only 320 acres, and yet the province is suggesting it be given 4,580 acres subject to the committee's decision, which I think is wrong. If Barrie was prepared to settle before the Ontario Municipal Board for 320 acres why would the province then turn around and impose a maximum of 4,580 on Barrie, for whatever reasons?

Next, I do not think the compensation for the legal costs has been addressed by the government to date. Both municipalities have experienced a considerable amount of legal costs due to the fumbling by the provincial government. It has been hundreds of thousands, and maybe millions of dollars, and yet this point has not been addressed.

The assessment that I indicated the other day is going to be lost by Vespra township was wrong. I indicated it was half of the commercial assessment. In fact, it is 90 per cent of the commercial assessment and half of the total assessment which is going to be lost by the township of Vespra. Therefore, it makes the township essentially impotent to deal as a viable municipality after the annexation. It is a considerable amount of land and an important assessment base which the municipality is going to lose.

I think the member for that area, who represents both Vespra township and the city of Barrie, obviously from a greedy political standpoint, has sided distinctly with the city of Barrie rather than taking a neutral position. I dare him to take a neutral position. I dare him to come before the House and say he has taken a neutral position on this, because everybody in Barrie and Vespra knows he has sided with Barrie on this simply because he thinks the votes are in Barrie and not in Vespra.

As I indicated the other day, I think the people of Barrie who have not asked for this annexation and who are fair-minded will remember that when they go to the polls, and I think the people of Vespra will remember it.

Last, I think the date of January 1, 1984, is not a fair date. I ask the government to change that at least to July 1, and better still to January 1, 1985, so that the standing committee on general government that is supposed to look into this matter does not have that cloud hanging over its head. The reason I suggest a delay of at least six months, but even better of a year, is that I have spoken to representatives from that area and they find it impossible to get the firefighting equipment and so forth in place for the residents and for the 4,580 acres, which protection obviously is supposed to be available based on the legislation that is proposed.

I am told that if Barrie is supposed to police this area it is immediately going to have to buy at least another police cruiser within the next week or week and a half, and have another two or three constables to look after that area.

I am told they are not in a position to look after the roads they are going to have to look after that quickly either.

Last but not least, they need to have everything all set for the assessment of that area, and they are not going to be able to do that. Let us assume for a moment that they would look after the assessment of over 4,500 acres starting on January 1, then, if the committee decides, and the government has the majority on that committee, that it should be 4,000 acres or 4,080 acres, everything is going to have to be changed again. I do not think that is fair to the people in Barrie, in Vespra township or in the provincial civil service to be flipping back and forth.

5 p.m.

I ask the minister, through his parliamentary assistant -- we notice the minister is not here again -- seriously to consider changing the date of January 1, 1984, to at least July 1, 1984, or possibly January 1, 1985.

Mr. Breaugh: Mr. Speaker, we will oppose this piece of legislation. I want to begin by reading into the record a resolution which was passed this morning at the county council in Simcoe. I think it puts a good perspective on why the members here ought to oppose this legislation. It reads:

"Whereas the provincial government has introduced Bill 142 to enforce annexation of land presently in the township of Vespra to the city of Barrie without ascertaining in a proper and democratic manner whether such annexation is required; and

"Whereas prior to the introduction of such legislation this county had passed a resolution opposing annexation on the grounds that it would be detrimental to the interests of the residents of the county of Simcoe; and

"Whereas the said Bill 142 wilfully ignores such opposition expressed on behalf of over 165,000 people;

"Be it resolved that the strongest possible protest be sent to the Premier of Ontario (Mr. Davis), the Honourable Claude Bennett and all MPPs representing this county on the grounds that such legislation is contrary to the democratic principles of this country and against the greatest common good; and

"Be it further resolved that a copy of this resolution be sent to every county in Ontario for endorsation on the basis that such arbitrary action constitutes a dangerous precedent which should be opposed by all who may ultimately be threatened with similar action.

"All counties endorsing this resolution are hereby requested to notify the Premier of Ontario, the Honourable Claude Bennett and their MPPs of their decision."

In a rather succinct form, I think the council unanimously addressed itself to the problem with the bill. Members may recall that in a previous session we set out a piece of legislation which provided for negotiations around municipal boundaries. Those of us who have had even an interest, let alone an active role to play, in attempting to arrive at a resolution of problems surrounding boundaries know that it can be a very vexing piece of business indeed.

There are a number of interests which collide and there are a number of positions which are difficult to accommodate. However, it seemed to me that Ontario, in the last session, had finally put its mind to this very difficult problem of boundary disputes which have gone on for some time. The real difficulty with them is that in a boundary dispute virtually no one wins.

The techniques available are to put applications before the Ontario Municipal Board. Other municipalities have attempted to use the judicial system either to overturn decisions made by the OMB or have provided for different courses of appeal. In the long run, many of our small rural municipalities have been faced with a problem they really cannot handle. Therefore, they hire lawyers, usually from Toronto, Ottawa or one of the major centres, to argue their case in court. These cases tend to go on for some lengthy period and the lawyers tend to be about the only ones who prosper by the length and acrimony of these debates.

The difficulty with this bill is that, for some reason which escapes me, the new Municipal Boundary Negotiations Act has not been used. When one listens to both sides of the argument from different sources, as I think we are obliged to do, one gets the distinct impression the government of Ontario chooses not to deal with this in a formal upfront way.

When one looks at the legislation before us today it is difficult to find out just exactly why, after a dispute which has gone on for more than a decade, the government of Ontario is now deciding this legislation is the route to go. Where was the intervention on the part of the government during all of this dispute?

I recall the past history of this dispute and it is an interesting one indeed. It is a dispute in which, in many ways, Ontario has been more than an observer through its land use planning, in plans put forward by Darcy McKeough at one stage. There are several members in this Legislature who are more than familiar with this kind of a dispute.

I do not know whether it is because the government, in a rather arbitrary manner, has decided that once each year it will find a tiny municipality somewhere in Ontario that is involved in a boundary dispute and will put forward legislation of this nature which really takes a whack at it.

Members might recall that last year Tiny township was involved in a dispute that was raised here in the Legislature. I found it interesting at that time that the minister had to be persuaded near the end of a session to send that dispute Out to a committee for an afternoon. Somehow Ontario's very life would have been threatened if people from Tiny township were allowed to appear in front of a committee of the Legislature.

I do not know what the fuss and muss was, but certainly when we got out there and spent barely an afternoon listening to the arguments from both sides, it became evident why the province was afraid to let that bill go out to a committee; contradictions galore were presented in the testimony.

If I were in a different position, say on the Ontario Municipal Board or a judge in a courtroom, it would strike me that little Tiny township had put together a pretty tough legal argument and had a pretty logical case, while the government of Ontario had no case on its side. It seems to me this bill presents us with a similar kind of context, that it is difficult to understand why at this particular moment the province has decided to take on Vespra township. I do not see the rationale behind it.

It is difficult for me to understand why they stood around, at least in a public way, and did nothing about it for virtually a decade; and now, all of a sudden, near the end of a legislative session, have decided to make their big move. It is tantamount to another invasion of Grenada. I cannot figure it out. I do not know why the province wants to conduct this invasion of Vespra township.

Mr. Renwick: There is another similarity; there is no press here, either.

Mr. Breaugh: Maybe that is it. Maybe another bit of Ronald Reaganism has crept into the Ontario Legislature. This is a good time to pull a move like this; at the end of a legislative session one can pull the wool over somebody else's eyes.

I think it is fair to mention, too, some of the activities of local members. One explanation that is put to me -- and I do not know whether there is a great deal of truth in it, but I imagine there is some measure -- is that the member for Simcoe Centre (Mr. G. W. Taylor) has decided in his mind that this is the time to put a move on Vespra township and that is why, all of a sudden, out of the blue, Bill 142 appeared.

Someone told me this morning that the member has put out to his constituents a letter claiming that this was his baby, that the resolution is his. Bill 142 is fair, honest, equitable, wonderful and all of that; and he did it, is claiming the credit for it. It strikes me that puts us here in the Legislature of Ontario in a bit of an awkward position because he is not the minister who is introducing the bill.

As a matter of fact, ironically enough, the Minister of Municipal Affairs and Housing (Mr. Bennett) is not here. His well-manicured hands have not touched this bill so far. I do not think he is going to be a participant in the debate. The minister responsible for this piece of legislation will not really have very much association with it. He made a rather neat, clean statement to the Legislature when the bill was introduced, and he is long gone.

Left to defend the flag, tattered though it may be, is the member for Wilson Heights (Mr. Rotenberg), the hit man for municipal affairs. He is the one who is going to be the villain in the piece; he is the one who will do the nasty work; he is the imported hit man brought in from offshore to conduct this invasion.

Yet I see that the member who is claiming credit for it back home in the Barrie area is not even sponsoring the bill. I imagine he will participate in the debate. I know we are going to ensure that he at least has the opportunity, as a member representing an area that is directly affected, to participate in the debate. I would be surprised if the member for Simcoe Centre did not join in this debate.

Mr. Ruston: Oh, I'm sure he will.

Mr. Breaugh: It seems to me he has that obligation at least. As the rumours fly through Simcoe county he is the man who arranged for it to happen; he is the guy who arranged the assassination of Vespra township, or annexation of Vespra township, whichever word one cares to put in there.

Mr. Nixon: How about "rape"? They usually use "rape."

5:10 p.m.

Mr. Breaugh: That is a Liberal word. Liberals are more commonly associated with that word than New Democrats are.

I seem to recall there are other members from the Simcoe area who might well be able to provide us with a good view of what happened there. The member for Simcoe East (Mr. McLean) is an example. I seem to recall not long ago, in another life, he was the reeve of Oro township and he cut his political teeth fighting a similar kind of move. When the province decided to invade that township the member stood his ground and said, "No, you cannot do that to my township."

It should be an interesting debate as we go through on second reading and gather up opinions from the local members in the forum where they are elected to express their opinions. We all know when members go back home they are obliged to write letters to their constituents, to make speeches or to chat with them on the street. But we also know those same people elect the members to come down here to Queen's Park and to go on the record in formal debates and on second readings where they put their personal position about a bill like this one in a public way; not in a private way, not in a little chit chat on a street corner, not in a one-way letter to their constituents out there but by participating in the debate.

If members believe this bill is a good bill they have an obligation to tell us why. They have an obligation to make the argument that they believe Bill 142 is fair legislation. I am certainly going to put the opposite side of that argument. I believe it is not fair legislation. I believe the premise of this bill is wrong.

It is a little difficult. For example, this morning I reread the statement made by the minister when he introduced the bill. I was looking for the reasons for the bill's presence before the Legislature. I got some background material of a decade of arguments and lawyers' fights over what was right or what was wrong with disputes before the Ontario Municipal Board and in other places, but I could not find anywhere an indication Simcoe county thought this was a good idea. I could not find anywhere that Vespra township thought it was a good idea. I did not even find a suggestion from the city of Barrie that it was a good idea. So where did the idea come from? That is missing.

There is a whole missing element that is not in place when I try to look for the reasons for the bill. When I look at the principles espoused in the bill, again I find some difficult things, things that do not quite match up. Why are the boundaries laid out in such a grandiose scheme here? If the government has made up its mind, if the government is putting forward a position it has certainly done so in a strange way. It has said, "Here are the boundaries of the largest annexation we can envisage." That begs the question that somehow when this goes off to committee the boundaries will shrink so there will not be quite so much of an invasion, there will be a little less pain.

It says there will be some financial redistribution in the area. The difficulty is that the annexation as it is now proposed is not really the kind of thing that says a little bit of money around the edges will resolve the problem. What the bill is doing to Vespra township is gutting the financial base of a rural township completely. It is taking away the real source of revenue, its business and commercial taxation. It is swooping on that. There is a bit of a land grab here.

What is more, it is a land grab without the compensation being spelled out. We are expected to believe that somehow in committee hearings the government will make its position known. In some quarters, when this kind of approach is taken, it is called nationalization. More than that, it is called nationalization without compensation. First the government steals the land and afterwards it decides how much to pay for it.

Mr. Nixon: Stick with the Grenada analogy, it is probably better.

Mr. Breaugh: My friend the member for Brant-Oxford-Norfolk likes the Grenada analogy. I do not like what happened there at all. I understand why he might be enamoured of that process, but I am not.

There are structural problems with what is being proposed here. I believe the county council in passing that resolution this morning hit the nail on the head. It is not the details of this bill that are so awful and offensive; it is the very principle of it. It is being done without any consultation in a formal way that other members here could find out about, other than whispered conversations and rumours which might have happened somewhere back around this area.

In a formal way I would ask the parliamentary assistant, or the minister if he has the inclination to show up, where is the request from a municipality out there to intervene now and resolve this dispute? I am fairly sure it is not there, not from either one of them, in a formal way that the members here could understand and could gather some public records of motions that were passed or consultations that were held; they are not there either.

What happens to the democratic process that many of us are so strongly in favour of when we say that municipalities in Ontario have perhaps not complete autonomy but only a lot of it; not a right to control their own affairs, to decide for themselves what will happen to themselves? In many ways we know they do not have that autonomy. They certainly do not have financial autonomy. But surely in matters such as this it is traditional that the initiation of legislation which would resolve something like this would come from one of the two affected municipalities. To the best of my knowledge, from what I could find out, it has come from neither of them. That disturbs me somewhat. When I look for a process at work I cannot even identify one, good or bad. This seems to have just materialized from somewhere.

I must say I give a little more credence than I usually do to the rumour that one local member has taken the bull by the horns, so to speak, and has decided that now is the time when this thing is going to be decided in this way. He is going to put it in there and he is going to use the majority of the Tory government to make it happen.

When one looks at the principles that have been put forward here it is not a very logical way to proceed. I recall the parliamentary assistant in a private conversation saying: "We have this little Barrie-Vespra bill. We want to bring it in. We want to have the members have a little debate on second reading and then we will whip it out to committee for a couple of weeks and take a look at the details."

Then I read the bill. I find the bill goes into effect on January 1. What happens in Barrie and Vespra township on January 1?

Mr. Rotenberg: Nothing.

Mr. Breaugh: The member says "nothing." All that happens is that a land grab occurs. After the land grab occurs we will worry about the financial details.

For example, one of the nice things that has been done here is that the reeve of Vespra township can sit on the Barrie council for a while. That is a wonderful thing.

I think this Legislature has a right to expect that when the government puts legislation of this nature before us we can see the process at work. We should be able easily and clearly to identify how the government of Ontario arrived at this legislation. We should be able to see minutes from a council meeting where it was discussed openly and publicly by a duly elected local council. We should be able to see there are motions that were passed by that council asking the province to proceed with this kind of annexation legislation. It is not there.

Quite the contrary. What I find is that the local county council is condemning the government for the bill, for the process, for the lack of respect for local government. I think the county councils resolution has a whole lot of justification behind it because there is not in place --


The Acting Speaker (Mr. Cousens): Order. Did the member say something that was unparliamentary? I was not giving full attention to the exact words.

Mr. Breaugh: I did not say "dishonest," let me put it that way. The member for Wilson Heights is feeling his conscience just a bit. He uttered the word; I did not.

The Acting Speaker: I just asked the member, because I have not seen the record. If there is something on the record, the member should try to expunge it.

Mr. Breaugh: I would like to expunge the member for Wilson Heights, but I cannot do that. I would withdraw the word "dishonest," but I did not use the word dishonest." The member for Wilson Heights used the word "dishonest."

Mr. Rotenberg: The member for Nickel Belt (Mr. Laughren) used the word.

Mr. Breaugh: He was parroting words used by someone else.

The Acting Speaker: Order, member for Wilson Heights. The member for Oshawa has the floor.

5:20 p.m.

Mr. Breaugh: These little interjections are so pleasant.

I want to go back to another document which was sent to many members, if not all of them, by the township of Vespra. It points out that this is not something being opposed willy-nilly by Vespra. It is true, it has been a dispute of long standing. It has been a dispute which I imagine has cost both municipalities a fair amount of money in legal fees. It has been a dispute with a strange and varied history. The township put forward to me, in a letter I received on December 9 a case, an argument, a logical, rational approach to opposition to this bill that deserves some mention.

The first point is an important one. The letter says: "The legislation has been introduced on the basis that it is a solution to a struggle between two municipalities which has taken place over a period in excess of 10 years. We were not the initiators of that struggle, nor did we ever wish to be participants. Certainly, we have defended our position against the initiators, as any man is surely entitled to do."

Even with that little slip into the wild west, that is a pretty good argument. The township is saying, in essence, that not only is this bill not of its liking or initiation, but the whole dispute is not of its liking.

There are two sides to boundary disputes. It is a little unfortunate that at this time I do not have a similar kind of condensed version of the argument from Barrie, but I anticipate we will get that. I am sure the member for Simcoe Centre, among others, will want to put on the record that side of the argument. I would be happy to put it on the record too if I had it.

The township's second point is also worth considering. It writes: "It has been stated that it is impossible to reach a conclusion in any other manner than by legislating." To digress from what it had to say for a moment, I am not aware that very many other alternatives have been tried. I am aware of the legal process that was at work, but I am not aware of any public attempts at conciliation on the part of the government, nor of any attempts made in a public way to resolve the problem without legislation or the use of the courts. Those things may have happened, but in searching through the records I have on this dispute I am not sure that a lot of time and effort to resolve it was spent on the part of the government in an open and public way of which one can find a record.

Perhaps that has occurred; perhaps it occurred privately. The difficulty is that it most likely did occur privately, and those of us who would like to search the records to find out what happened will never find out. The backroom boys took over, and deals, promises and offers were made and offers were refused. All was done behind closed doors, which is an unfortunate way for the government to proceed.

In pursuing that point, the Vespra township council said: "We do not understand how this statement can be made, in view of the fact that during the last three years the only attempt that was made at negotiation was by the council of the day of this municipality who wrote to Premier Davis in an attempt to establish appropriate negotiations.

"The resultant negotiations lasted through only three meetings because the city of Barrie indicated they then required twice the amount of land which had been found by the Ontario Municipal Board to be appropriate for annexation after the longest and most expensive annexation hearing in the history of the province." Not much of an effort was made, one would have to say, at least in a public, traceable way.

The township letter goes on to say: "It is already becoming apparent that a legislated solution is going to create bitterness, the extent of which and the political effect of which is going to be virtually unparalleled."

It is the township's right to have an opinion such as that. One part of that is surely fact; it is going to cause a lot of bitterness. The bitterness is already forming and it is at the instigation of the province, which did not seek a quiet or a negotiated resolution but came down rather heavy-handedly with an iron fist and said: "There is the legislation. There is your solution."

The difficulty is that it forces the participants to try to negotiate from a position of great weakness. I happen to have had some conversations with people from Vespra township and they asked me, "What happens from here?" I said, "If the bill carries on second reading, the proposal is that it will go to a committee of the Legislature and you will get an opportunity to participate in that way."

The difficulty is they are not going to be members of that committee. They will not have an opportunity to argue their day in court. They will have an opportunity to appear as witnesses but not as participants, and that is rather sad because they are more than just witnesses. Those people who are duly elected in that area ought to be participants and they will not be. The sad thing is this government has a majority now so there is not going to be much in the way of negotiating.

I think it is not unrealistic to say, and I am not being at all derisive, that the government has a majority and it has consistently shown it wants to exercise that majority. When it comes time to vote on any matter put before the committee, I have to tell the House who is going to win. I regret to say the Tories will carry the day. They have the majority of members on that committee. I would like to be able to say that in fairness it is fairly common practice around this Legislature that anyone who has a good idea is going to carry the day, but that is not true.

Most of us who have spent time here debating bills and proposing amendments in committee, going through things clause by clause or doing committee reports, know the government carries the day and the government gets almost paranoid about even the presentation of ideas from an opposition side. For example, the other evening when we were debating a related piece of legislation, Bill 119, the government saw fit to produce a couple of amendments in the afternoon. It expected and got unanimous consent from the Legislature to put the amendments because there was some technical question as to whether the amendments would be in order.

Yet when an opposition member decided to put forward the same kind of amendment dealing with his regional municipality, having to do with a matter which had been passed by the local council and by the regional council, and which I am sure the government and opposition members knew had been widely discussed and widely endorsed in the community, it was a bit of a battle even to get it on the floor even though the government House leader was saying they would give unanimous consent. That seems quite illogical to me. He has his majority over there. Why not let him put the amendment on the floor, because when it comes voting time one thing they know for sure is they have more members over there than there are here. They cannot lose.

The same parliamentary assistant who is carrying this bill sat in his little place over there and chirped, "No, no." Ten minutes earlier he had said: "Listen fellows, we are all honourable gentlemen. I have a couple of little amendments here which might be out of order, but you will all give us unanimous consent to put them, will you not?" It happened to be about matters where we agreed and we all said, "Sure, why not?"

Mr. Stokes: Some are more honourable than others.

Mr. Breaugh: This is the Legislature of Ontario and we know one another. We knew the substance that was in those amendments. It seemed to all of us that it was a fair, honest and reasonable way to proceed. But not to the member for Wilson Heights who is now carrying this legislation and expects me on the opposition side to decide he is going to change colour completely when it comes to dealing with Bill 142, that he will not be worried about being in a majority, that he will not be worried about who puts forward the amendments, that he will not be worried about the procedural stuff and that all of that will fall in place gently.

I do not believe that is going to happen. He is asking a great deal of me as an opposition member to believe that this blank cheque, Bill 142, will be signed and then all the details will be filled in later. It seems to me quite the contrary. In entering into this kind of negotiation, in entering into legislation of this nature, we on the opposition side, and members of the government side as well, have a right to expect the detailed work to be done before the legislation is introduced.

I recall the legislation setting up the region of Durham, which is a similar type of activity. I happened to be involved in that. There was great concern on the part of the council. First, a proposition had been made that they had never heard of, very similar to this situation. Second, a demand was made fairly clearly in that area that the government of Ontario had better get off its duff and get down to that area and start talking about the details because we wanted to know facts, figures, boundaries and all of that, all of those things that are of concern to members of a municipal council.

5:30 p.m.

It seems to me that people in Vespra, in Barrie and throughout Simcoe county have a right to know now just exactly what the government is proposing. It is not a reasonable way to proceed to say: "Here is a bill which is going to cover this annexation. This is the largest area, but it may get smaller or it may change in shape. All of that will get sorted out later." It is not good enough for the government to say, as it does in this legislation: "We know there is going to be some financial disruption, but do not worry about it, boys, we will take care of that later."

I would think that municipal councils and opposition members, and government members for that matter, have a right to know a little bit more of the details. The government is ripping the guts out of the financial base of Vespra township. How is it going to replace that? What does it have in mind? A couple of transfer payments or a couple of Wintario cheques? Is the government going to have a couple of raffles up there? Just exactly how does it propose to re-establish a financial base in Vespra township?

That is a pretty legitimate question for Vespra township people and the county council to ask. Opposition members have a right to an answer of some sort. Do not give me this business about, "Do not worry, boys, we will look after you later."

I have been involved in different kinds of negotiations. It seems to me that anybody who would sign on the dotted line or nod his head wisely at the appropriate moment to an agreement of that nature would be crazy. That is just not the way business is done or contracts negotiated, or how an agreement of this sensitive, complicated, technical nature will be resolved. Quite frankly, in my opinion the people in the county of Simcoe would be a little nuts to accept that kind of blank cheque approach, "Do not worry about it; we will work out some arrangements later."

I want to go over a couple of more things that are here in this little letter which was put out to us from Vespra township. They talk about the bitterness that is going to be created and has been created now. They talk about the land claims that are made by the city of Barrie. Nowhere in conversations with people from Vespra or people from Barrie can I find someone who ever proposed that the government's legislated solution is sensible in terms of land size. Nobody on either side of the argument has ever proposed that.

Vespra township goes on talking about what this will do to revenues for the city of Barrie. I think the member is quite right, there will not be a dramatic increase or decrease in revenues to Barrie; but the estimation from Vespra township is that the loss of this land represents at least 90 per cent of its commercial assessment or approximately 45 per cent of its total assessment, just about half.

I know what happens in my municipality when something jeopardizes five or 10 per cent of the municipal assessment. People start taking a look at that and say that is enough to make an impact on each and every home owner out there. If we were talking about half of the assessment going out the window in Toronto, Oshawa, Sudbury or anywhere else, that is big money. That is not only a problem for council, although eventually the councillors would pay a political price if they just sat around and watched that happen, but for individual home owners.

I will not go into all of the details that have been put forward by Vespra because they did give us a very tight, concise argument, which I anticipate members will hear again if and when this bill does get through second reading and goes off to committee.

They go into the history of the details of the decisions that were made by the Ontario Municipal Board and give their opinions on those. They go over some of the history of Barrie's inheritance of 8,000 acres from the township of Innisfil at the beginning of 1982 so that it now has more than sufficient land on which to develop and prosper.

The county of Simcoe, having already sustained a substantial loss as a result of the transfer of the land from the county township of Innisfil to the city, now stands to lose yet further substantial assessment as the result of this legislation with no compensation payable to Simcoe. The effect of this will be that every person in the whole of the county of Simcoe -- the estimate here is 225,000 people -- will pay a proportionate part in the price of this land transfer.

They go on in their appeal to attempt to use the Municipal Boundary Negotiations Act, which I think is their expectation, and I imagine we will hear in committee that they will want to have some version of that act, or at least to use that act and have it apply to their situation. It seems to me that is a pretty tight argument. Why would the Legislature of Ontario pass an act specifically designed to resolve boundary disputes and then, less than a year later, throw it out the window and say: "We are not going to use it. We don't even want to bother to try use it. We are just going to go back to a straight, old-fashioned annexation bill"?

It is a very heavy-handed, unfeeling, unkind way to proceed and I am at a loss to explain it. I do not understand why the government did not at least make the effort to use the act. Comparatively speaking they have had 10 years of litigation. Why would they not give their boundary negotiations act an opportunity at least to be tried?

Mr. Laughren: You think maybe he had his reasons, that there were ulterior motives?

Mr. Breaugh: There may have been other reasons the government of Ontario chose to do it.

I want to conclude with another little quotation from this letter, because I think they hit the nail on the head again. They say:

"Finally, the timing involved in the bill is so immediate as to be absurd. The bill specifically provides for the land in question to pass to the city of Barrie on the first of January 1984. In other words, the county and the township have less than a month in which to adjust their position to take in the substantial revenue loss, and the city of Barrie has precisely the same period in which to provide fire protection, road service, etc. to the fairly substantial annexation area.

"In addition to this, the change in assessments will have to be recalculated by the assessment office, and may then require further recalculation if and when it is established that any part of the proposed annexation area is not in fact going to be annexed.

"If this bill has to take effect, the parties involved should be permitted a year in which to adjust and prepare for the changes. It is accordingly strongly suggested that this act should not take effect until the first of January 1985."

That is pretty commonsense stuff. It seems to me they have made an argument, and they have obviously learned from other people's experience, that there is a need for a fairly lengthy lead time. The government can say: "Don't worry, boys. Nothing is going to happen on January 1. The dogs will still run up and down the streets, the fire department will be there, the police department will be there and no bad things will happen." I happen to be of the school of thought that if the government of Ontario thinks it is such a hot idea that this bill ought to proceed, I cannot for the life of me figure out why it would not have given them sufficient lead time so that all of their concerns would be allayed by the time the bill takes effect.

The minister came to my area and talked about regional government and substantial changes in boundaries, in obligations and in financing. To be fair, the discussion on that process probably elapsed over pretty close to a decade. Before he got to the point where he talked about legislation and started drawing boundaries, responsibilities and all that, we had about 18 months, at least a year in a formal way, to get ready for the transition period.

But here in this bill he is proposing that all that stuff be abandoned: "First, we are going to do it and then we are going to figure out how we are going to do it." It makes no sense to me. It strikes me the township of Vespra has made a reasoned argument in this little letter to the members. I do not know quite how many members got it, but I know I did and several of my colleagues on this side did; I would imagine government members got it as well. They made a reasoned argument and basically they are asking, as a bottom line, for a little lead time to prepare for this.

They need to consider several very complicated matters. They certainly did not get any notice -- at least, I am not aware that they got notice -- that the legislation was even forthcoming. Maybe the government member in the area went and told somebody, but when I went looking for notices from the province that they intended to proceed with what is now called Bill 142, I could not find that notices went out to Vespra and Barrie, the affected municipalities.

5:40 p.m.

There is nobody carrying this bill in the House at this time. The minister is not here: the parliamentary assistant is not here. There is nobody I can question who is responsible for the bill. So I am not sure how we proceed here. The Speaker is having a friendly chat up here. The Minister of Correctional Services (Mr. Leluk) is reading his newspaper. The Solicitor General (Mr. G. W. Taylor) is resting comfortably, as he usually does.

When we ask even simple questions in the course of debate, such as, "Did you send out notices to anybody that you were introducing this legislation?" we cannot get answers. If we cannot get even a simple response to a question like that, imagine what it feels to be one of those affected municipalities, where there is a need to know that legislation is forthcoming. There is a need to know the financial details of all this. There is a need to know who is going to be carrying the responsibilities come January 1 in Vespra township or in Barrie or wherever gets annexed.

No one does know that. They are being asked to accept on blind faith that a government that did not even bother to discuss it with them is somehow going to look after their needs later on. It seems to me the government is asking a bit much.

I want to get to some of the principles of the bill because I think they are worth debating. In particular, they should raise some questions in the minds of members here as to what precisely is being proposed. As a guideline, I will use what is provided as an explanatory note because I think these principles have to be accounted for in this debate.

First, "certain described lands in the township are annexed to the city on January 1, 1984." That is fairly straightforward. The only thing that is not so straightforward is that we do not know, and the government admits we do not know, what those certain described lands will be. We do not know what they will be, but they will be annexed on a particular date, January 1, 1984.

Mr. Rotenberg: That can be changed too.

Mr. Breaugh: That could be changed too.

Mr. Rotenberg: I indicated that in my opening remarks.

Mr. Breaugh: This is getting ridiculous. Does the parliamentary assistant mean that January 1, 1984, could be changed?

Mr. Rotenberg: Of course.

The Acting Speaker (Mr. Cousens): Order. We are not in committee.

Mr. Breaugh: I happen to take the government at its word, as it prints the stuff up. It seems to me what I am being asked to vote for this afternoon is an unknown quantity of lands on an unknown date; a pig in a poke.

When certain native people sold Manhattan Island at least they knew how many beads they were going to get and the water around it told them what the boundaries were. In Vespra township, we are not even doing that. It seems to me the members in the Legislature this afternoon who have to debate this bill do not know, cannot possibly know, first, exactly what lands are under discussion here, because the government does not know; and second, according to the parliamentary assistant, who is the sole, feeble voice of the government on this bill, we are not even sure when. That seems to me to be a reasonable basis on which to oppose the legislation. These are logical questions to ask.

The second principle they put in here is that "the assets and liabilities of the township attributable to the annexed area become assets and liabilities of the city without compensation." Whoa. Wait a minute. I bet if one of our members suggested that something of a physical nature be taken over without compensation, the member for Wilson Heights would be one of the loudest screamers that one cannot seize private assets without compensation; one cannot even say so.

Ironically enough, this afternoon he is the member who is saying that a portion of a municipality in Ontario in 1983 can be seized without compensation, quite a remarkable statement for the member for Wilson Heights to have to defend.

The provision is made for a committee of arbitrators to determine which of the assets and liabilities of the township are attributable to the annexation. One can see that somehow the central junta will sit down at some point and divide up the spoils. In a yet unnamed committee, a yet unexplained set of circumstances will get divided up.

If somebody came tome and said, "Mike, we want you to buy a car. Later on, we will tell you what the price is. Later on, we will have the central committee sit down and they will tell you what the monthly payments are. Later on, someone will come in from some other regime and tell you whether you can or cannot drive the car," I would be a little upset. I suggest that is not a reasonable way to proceed.

Much like the township of Vespra, I am suggesting to the members this afternoon that this bill is not a reasonable way to proceed.

The third explanatory note is that, "Unpaid taxes on the annexed lands may be collected by the city as though they had been imposed by it." That is quite a remarkable little concept the government is proposing. It is not only taxation without representation; it is taxation by a group that has no jurisdiction, let alone representation.

The old Boston Tea Party and several revolutions have been fought around that very concept. Yet I look at a Tory government in Ontario saying in an explanatory note that a bill it is proposing to the Ontario Legislature says, "Unpaid taxes on the annexed lands may be collected by the city as though they had been imposed by it," recognizing it was not the city's right to collect those taxes, and recognizing the people in that piece of Ontario did not have any representation because at that time they lived in another municipality, but allowing one municipality to take taxation from another as though it had imposed it. That is a really neat political concept.

I am not sure whether even the member for Niagara Falls (Mr. Kerrio),who is usually referred to as a very right-wing member, would allow that kind of legislation to be put forward. I think even he would say one cannot do that. There has to be a little bit of democracy thrown in around the edges to make it look good.

There has to be at least a defined jurisdiction. One cannot let them collect taxes after the fact on a piece of property that was not even part of their municipality. I think the member for Niagara Falls will be one of the first people up to say: "That is wrong. You cannot do that. Even I think that is wrong."

My colleague the member for Niagara Falls is pretty good about that kind of stuff. He jumps right into arguments like that. He does not let that kind of stuff float by. If he were here this afternoon, Mr. Speaker, he would have identified that. I am sure he would.

The fourth little principle the government is espousing this afternoon is equally unique. It says, "Provision is made for the application of city bylaws to the annexed lands and to deem the provisions of the township's official plan pertaining to the annexed lands to be provisions of the city's official plan."

That is also remarkable because most of us who have had some experience on municipal council have been defenders of the faith, so to speak, around the planning process, so that every time a bylaw is changed, every time an official plan is changed, any time any planning activity out there happens, there are a couple of things that are sacrosanct. First, one tells people about it; one provides them with notice. Second, one provides an opportunity for them to come before a committee of council or the full council and voice their opinions about the matter.

Planning matters have been overturned because councils forgot to notify people or did not bother to hold the public hearing. The OMB is full of cases where some irregularity was found there.

But in this bill this government is saying: Never mind about the planning process or about the right of people to object to whatever zoning bylaw might have been proposed or planning amendment might have been put forward. Never mind all that trivial garbage that is called democracy. Let us just take these zoning bylaws and apply them to this little area over here." It is as if an old zaparoo was put on.

It seems to me that anybody who has had even the most fundamental involvement in the planning process in Ontario knows one of the cornerstones of it all is supposed to be an openness and a willingness to listen to the people who are directly involved in whatever it is in the planning process that is going on, a bylaw or a planning amendment. The right of individuals to be aware that a change in zoning or planning is going on in their area is held to be essential. The right of those people to appear to comment and to say their little piece about all of that is held to be almost sacrosanct in Ontario.

5:50 p.m.

There is something wrong with that process as well because, for example, it does not even mention a period of time. It just says flat out, "Provision is made for the application of city bylaws to the annexed lands and to deem the provisions of the township's official plan pertaining to the annexed lands to be provisions of the city's official plan." It is a neat little myth. We take one set of bylaws from here and shove them over here, and another set of bylaws from here and shove them over here, and never mind the people's rights under the Planning Act or the Municipal Act to state their argument. Just set that aside.

The next little piece is an interesting concept as well. It says, "The Minister of Municipal Affairs and Housing is empowered to order, over a transitional period, that different rates of taxation be imposed on the lands annexed to the city and on the remainder of the city than would otherwise be imposed."

Some of us have been foolish enough to think over the years that rates of taxation in local municipalities are established in a very open way by municipal councils deciding on their budgets, matching them up to their assessment, establishing their priorities, establishing a rate of taxation and that is it. Some of us laughingly refer to that as the democratic process, far more democratic, for example, than the process used here to strike a budget.

But this little bill says. "Well, let us just set that aside for a while." What we have here is one person who is not a resident of either municipality, that is to say the Minister of Municipal Affairs and Housing (Mr. Bennett), who has total power to order the rate of taxation. That is exactly what the explanatory note says -- total power to order the rate of taxation.

It goes further than that. It says he can impose different rates of taxation. That is an interesting compensation, it is an interesting consideration, because in municipalities there are lots of arguments over assessment -- that somebody's house or property is worth more than somebody else's. But the rate of taxation is held to be the same and the variance at work there is that the value of one's property is different.

That concept, fought for over a lengthy period of time, goes out the window too, because now the minister says there can be different rates from place to place. He does not say who or what, just that there can be. One man -- not a council, not anybody elected in either Vespra or Barrie, but one man sitting in Queens Park -- has the power to establish those rates. The next logical thing is to ask the question, "How long, Lord? How long?"

It gives lots of detail here because it says "over a transitional period as yet unspecified." There is now some magical power put to the Minister of Municipal Affairs and Housing over an unspecified period of time to level unspecified rates of taxation, at different levels, in different places.

Mr. Rotenberg: Read section 6. It is about time you specified.

Mr. Breaugh: Excuse me, Mr. Speaker, I am getting instructions from the member for Wilson Heights whom I intend to ignore as I always do.

The next principle the bill contains is the provision made for the payment by the city to the township of compensating grants for the loss of assessment caused by annexation. That too is an interesting concept. It is not too often that one municipality in Ontario is expected to pay grants to another municipality in Ontario. For the most part, grants are paid by the province of Ontario to municipalities. This introduces a new concept in Ontario financing, which in essence says the city of Barrie is going to pay grants to the township of Vespra. I would suspect the township of Vespra is not happy with that provision but I would really be interested to know how the city of Barrie feels about a provision in provincial legislation which requires it to make grant payments to another jurisdiction.

I am familiar with the fact that in many municipalities we have financial arrangements back and forth -- where they are sharing an arena, fire services, building roads or there is some tie-in. But they negotiate those things. This bill says the city of Barrie is now going to be in the business of providing grants to the township of Vespra. Here all along, foolish me, I thought it was the province of Ontario which provided grants to municipalities, not one municipality being designated by the province to give grants to another.

It says in the next one --


Mr. Ruston: The speaker is repeating himself.

Mr. Breaugh: No, I am reading a list.

The member for Niagara Falls would never let that kind of heckling go on in here. He would keep order. Were he in the chair this afternoon I would be safe to proceed with my speech unharassed by other members.

I think we would be in better shape if the acting Speaker could figure out how to work the microphone.

Mr. Epp: On a point of order: Since the member for Niagara Falls cannot defend himself, I want to say on his behalf that he is probably the worst heckler in the House.

Mr. Breaugh: I cannot let that go unchallenged. I would say the member for Niagara Falls is probably one of the best hecklers in the House. I do not understand why his colleagues deride him in his absence.

The Acting Speaker (Mr. Kerrio): Order. I would like to hear the member for Oshawa. The member for Oshawa has the floor.

Mr. Breaugh: That is right. I think it is particularly unfair for other members to do that.

It does say that "the minister is empowered to grant financial assistance in the manner specified to the two municipalities."


Hon. Mr. Pope: Order.

Mr. Breaugh: Is there grave disruption in here, would you say?

The Acting Speaker: The member for Oshawa has the floor.

Mr. Breaugh: Thank you.

Mr. Martel: Can you control the House?


The Acting Speaker: Would the member for Oshawa continue, please?

Mr. Breaugh: I find it very reassuring that in enunciating the principles the government has put out in this bill we find that "the minister is empowered to grant financial assistance in the manner specified to the two municipalities." For that, we should be eternally grateful. It does not necessarily say he is going to do that, If I were entering into an agreement or set of negotiations like this I would certainly want to see that. But it does say, briefly enough, that he is empowered to grant financial assistance.

The next one is interesting too. It boggled my mind when I saw it. It says that "the head of the township council is ex officio a member of the city council." I find that interesting from a number of points of view, not the least of which is just in pure human terms. I wonder how the head of the township of Vespra council is going to feel sitting ex officio on the city of Barrie council. Is he going to be a full and active participant in council business?

From both sides of the coin, if I were the reeve of Vespra township I would say: "Thanks, but no thanks, boys. We are into an argument with these people and I do not particularly want to sit in the lion's den one evening a week and see how many strips they can take off my back"; on the other hand, if I were a resident of Barrie, I would say, "We know how to elect our own city council here in Barrie and we do not need the government of Ontario to put somebody from another municipality on our council by legislation."

I know this government on occasion feels the electoral process has served its purpose and should be done away with, but it seems to me it is not necessary for it to pass legislation to determine who will or will not sit on the city council in Barrie. I do not think that is necessary at all. I think we could do without that. There are those who would say that is totally undemocratic, that it runs contrary to every democratic principle anybody has ever espoused that a government should use its majority to, in effect, do away with an election, which is what it is doing.

If I were a resident in Barrie that would be one of the things I would object to. If I were the reeve of Vespra township I surely would object to that particular principle in this bill.

The Acting Speaker (Mr. Cousens): The member has one more minute.

Mr. Breaugh: I do have some other comments but it is getting close to six o'clock if the Speaker would like me to close.

The Acting Speaker: No, there is still a minute.

Mr. Breaugh: The next one they put on the record here is an interesting concept. It happens to be one with which I am a little more familiar than I care to be. It says: "For the purposes of the next regular election to be held in 1985, the minister is empowered to redivide the city into wards, taking into account the annexed lands, and may provide for the composition of the council of the city."

I have to say that even for me that is far too much power to put in the hands of the minister. It strikes me the city council in Barrie may want to realign its ward system should an additional piece of property be put in.

Is the Speaker now saying it is six o'clock? If the Speaker wishes to call six of the clock, I will resume debate later.

On motion by Mr. Breaugh, the debate was adjourned.


Hon. Mr. Wells: Mr. Speaker, just before you leave the chair, I should indicate that this debate cannot continue tonight because the estimates of the Ministry of Municipal Affairs and Housing are being heard downstairs. I suggest we continue this debate as the first order of business after question period tomorrow after we do the private bills on the order paper.

Tonight at eight o'clock we will begin with second reading of Bill 141, the Employment Standards Amendment Act. Following that, we will do concurrences in the following order: Labour, Justice Secretariat, Solicitor General, Correctional Services, Agriculture and Food and Environment.

The House recessed at 6 p.m.