33rd Parliament, 1st Session

L072 - Tue 17 Dec 1985 / Mar 17 déc 1985

STATEMENTS BY THE MINISTRY

EMISSION DISCHARGES

INJURED WORKERS

MASSEY-FERGUSON

REPORT ON OAK RIDGE DIVISION

REPORT ON ENVIRONMENTAL HYPERSENSITIVITY

ORAL QUESTIONS

URBAN TRANSPORTATION DEVELOPMENT CORP.

DOMED STADIUM

EMISSION DISCHARGES

ONTARIO INSTITUTE FOR STUDIES IN EDUCATION

RENT REVIEW

PSYCHIATRISTS' SALARIES

RENTAL ACCOMMODATION

DOMED STADIUM

LOW-ALCOHOL PRODUCTS

REPORT ON FINANCIAL INSTITUTIONS

RED MEAT PLAN

REPORT

STANDING COMMITTEE ON ADMINISTRATION OF JUSTICE

MOTION

COMMITTEE SITTING

INTRODUCTION OF BILLS

WORKERS' COMPENSATION AMENDMENT ACT

LABOUR RELATIONS AMENDMENT ACT

EMPLOYMENT STANDARDS AMENDMENT ACT

EMPLOYMENT STANDARDS AMENDMENT ACT

PUBLIC SERVANTS POLITICAL RIGHTS ACT

HEALTH PROTECTION AND PROMOTION AMENDMENT ACT

ANSWER TO QUESTION IN ORDERS AND NOTICES

ORDERS OF THE DAY

RETAIL SALES TAX AMENDMENT ACT

LAND TRANSFER TAX AMENDMENT ACT

TOBACCO TAX AMENDMENT ACT

FUEL TAX AMENDMENT ACT


The House met at 2 p.m.

Prayers.

STATEMENTS BY THE MINISTRY

EMISSION DISCHARGES

Hon. Mr. Bradley: Today I am pleased to announce the boldest initiative against acid-rain-causing emissions ever undertaken in North America.

This government's program requires our four main producers of acid-rain-causing sulphur dioxide to reduce their emissions from the 1980 level of 1,933 kilotonnes to a maximum of 665,000 tonnes of sulphur dioxide by 1994. That is a reduction of 67 per cent. The affected sulphur dioxide sources are Inco, Ontario Hydro, Falconbridge and Algoma Steel. We have applied a stringent yet realistic regimen requiring staged sulphur dioxide decreases for each company.

In addition to Inco's announced reduction to 350,000 tonnes in 1994, our government is requiring further cuts. Inco's permitted sulphur dioxide emissions are reduced to 685,000 tonnes immediately from 728,000 tonnes currently. A limit of 265,000 tonnes has been set for 1994. We have also set an objective of 525,000 tonnes for 1990 and a further objective of 175,000 tonnes as a goal for 1994.

We have asked Inco to study and report regularly on the means of reaching the limit set for 1994 and these other levels, including the economic and technical feasibility of achieving them and the extent of government financial assistance, if any, that may be required to achieve them.

Sulphur dioxide emissions from Ontario Hydro will be cut from a 1984 level of 444,000 tonnes to a legal limit of 175,000 tonnes in 1994. This is significantly below the 260,000-tonne target set by the previous government.

Falconbridge has enjoyed a good record of reducing its sulphur dioxide emissions from its Sudbury smelter to the current emission limit of 154,000 tonnes per year. We are requiring that the company further reduce its emission levels to 100,000 tonnes per year by 1994.

The Algoma Steel iron ore sintering plant in Wawa operates within a Ministry of the Environment control order that limited its emissions to 285,000 tonnes per year. Our new regulation reduces Algoma's allowable limit to 180,000 tonnes annually and further reduces its sulphur dioxide emissions to 125,000 tonnes per year by 1994.

This abatement program is called Countdown Acid Rain and takes effect immediately. Under the program, all four emitters will be required to submit regular reports to outline the steps being taken to attain their sulphur dioxide emission limits. They have all been given until 1994 to complete acquisition and installation of necessary pollution abatement measures or new, less-polluting technology. It will take them that long to do a proper job without adversely affecting our economy, but each company knows its schedule.

We have engaged in intensive meetings with senior corporate executives to determine how this program will be put into practice. To their credit, they are taking the abatement program very seriously and clearly understand their environmental responsibilities. They realize we mean business when it comes to reducing acid rain. We are demanding a lot from them. However, we are confident they will come through, for the environment and for the people of Ontario who work and play in it.

The countdown on acid rain in Ontario has begun. This watershed program marks the turning point in the restoration to health of Ontario's dead and dying streams, lakes and forests. With Countdown Acid Rain, Ontario has now done its full share, and then some, to abate the acidic emissions that threaten our sport fish, timber stands, croplands and historic public buildings.

However, the Ontario effort, and the entire Canadian abatement commitment of which it is part, will not by itself save our vulnerable environment and the thousands of jobs that depend on threatened renewable resources. Half of all the acid rain ravaging Ontario's environment originated in the United States. The effect of Ontario's acid rain production on US states pales in significance in comparison to the devastation created by US acid gas emissions.

Ontario sources are responsible for acid rain that falls on New York's Adirondacks and New England. By 1994, our programs alone will reduce total acid loading in those US areas by seven to eight per cent.

I urge the United States to face up to its responsibilities, as Ontario is doing today, before it is too late. It is imperative that our neighbours now implement stringent pollution standards to compel their industries to reduce their acid-rain-causing emissions drastically.

Countdown Acid Rain is sending a tough, direct message to the United States. Ontario is no longer just talking about acid rain. We are acting responsibly and decisively. We hope our program will assist Canada's acid rain envoy, Bill Davis, in his efforts to convince our American friends to do their part.

This program will not be cheap for the four major acid gas emitters. It will cost several hundreds of millions of dollars. However, there will be federal and provincial assistance available in cases of demonstrated need. The alternative to Countdown Acid Rain -- all talk and no action -- is far costlier.

INJURED WORKERS

Hon. Mr. Wrye: On the occasion of the last increase in workers' compensation benefits in July 1985, I indicated that it was the intention of this government to undertake an examination of the implications of permanently indexing workers' compensation benefits and, as part of that examination, to consult with the various interested constituencies.

Later today I will be introducing for first reading a bill that is the result of those endeavours. It reflects the commitment of this government to injured workers. The bill enshrines permanent indexation and implements an immediate increase in benefit levels as a transitional measure. In addition, it will grant a substantial increase in survivors' benefits for claims that originated prior to April 1, 1985.

2:10 p.m.

The bill establishes January 1 in each year as the adjustment date for workers' compensation benefits, utilizing an indexation formula based on movements in the consumer price index over the 12-month period ending the previous October. This will ensure that injured workers and their families will be protected from the hardships caused by inflation.

The indexation principle will be extended to all monetary amounts set by the act, including the covered earnings ceiling, the lump sum payments for surviving spouses, clothing allowances and the minimum allowance for burial expenses.

January 1 was selected as the adjustment date largely because it coincides with the effective date of each year's new tax tables used to establish a worker's net earnings for purposes of computing benefit entitlement. As a consequence, a transitional step is required to move from the customary July 1 date for benefit adjustments to a new January 1 date.

The six-month period in question will be bridged by adjusting benefits with reference to the rise in the consumer price index over the most recent six-month period for which data are available, namely, the period from April to October 1985. This approach is consistent with the method proposed for the long-term annual indexation of benefits and yields an adjustment factor of 1.7 per cent.

In addition to the 1.7 per cent increase, all survivors' benefits paid in respect of deaths which occurred prior to April 1, 1985, will be increased by a further 10 per cent. As a result of the total increase of 11.9 per cent on a compounded basis, the pension for a surviving spouse will rise from the current level of $641 per month to $717.28, and the dependent child's allowance will change from $179 to $200.30 monthly.

The 10 per cent adjustment has its origins in the discrepancy in treatment of new and pre-existing survivors' claimants as a result of Bill 101. While claims arising on or after April 1, 1985, were subject to the more generous provisions of the new dual award scheme for survivors, earlier claimants remained on the previous flat-rate survivors' benefit scheme. In effect, the latter group derived no direct benefit from Bill 101.

It was estimated, at the time Bill 101 was introduced, that a gap of about 13 per cent existed between the flat-rate survivors' pension and the average pension to which the same recipient would have been entitled under the terms of the new earnings-related survivors' pension scheme. The gap was reduced by three per cent in July 1985, when the present government awarded to the claimants in question an average eight per cent benefit adjustment, compared with the general increase of five per cent.

The 10 per cent increase that will now be awarded closes the gap completely in one step, rather than doing so on a gradual basis. There is no justification for waiting any longer to provide justice to this group of survivors. In future, all survivors' benefits, whether under the old or new schemes, will be escalated in accordance with the general indexation provisions I have outlined.

Finally, the amending bill contains a number of housekeeping changes unconnected with indexation, the most significant of which involves removing employees of the Workers' Compensation Appeals Tribunal from coverage under the Workers' Compensation Board superannuation fund, thereby placing them within the public service pension scheme. Since the tribunal is totally independent of the board, there is no justification for inclusion of its staff members under the board's superannuation plan.

Automatic indexation is a reform that is long overdue. Every year since I first became a member of this Legislature, there has been a debate on the appropriate level of that year's WCB benefit amendment and every year the two opposition parties have berated the government of the day for its failure to move to formal indexation.

The measures being proposed by the present government will ensure that injured workers will no longer have to worry about whether and to what extent their benefits will be adjusted. In future, all claimants will be assured, as a matter of statutory right, of an annual adjustment which takes into account the effects of inflation.

The pain, the loss, the disruption and the disorientation caused to a worker and his or her family by a disabling injury is suffering enough. We should never add to this suffering the indignity of having to come cap in hand to the steps of the Legislature angrily demanding merely the protection of compensation benefits from the annual rate of inflation. From this day forward, injured workers will never again be in that humiliating position.

[Applause]

MASSEY-FERGUSON

Hon. Mr. Nixon: I am afraid my statement is not going to elicit much of an ovation. I would like to provide some information to the House about a proposed restructuring of Massey-Ferguson.

As the House is aware, in 1981, the previous government of Ontario purchased $75 million of Massey-Ferguson preferred shares from a group of Canadian banks pursuant to a guarantee agreement. Coincident with Ontario's investment in Massey's preferred shares, three things occurred: the company ceased paying dividends, the former government wrote the value of its $75 million of Massey shares down to zero on the province's books and there were significant recurring layoffs at the Brantford combines plant.

Further, for those in the House who may be thinking the Massey investment has produced large employment benefits, let me advise them that the then Minister of Industry and Tourism negotiated job commitments at the 6,100 level. These were never attained, unfortunately, and there have been recurring layoffs. When in operation, recent employment levels have approximated 1,200 workers. At present, only 275 people are employed.

As for the proposed restructuring, I wish to inform the House that officials of the Ministry of Industry, Trade and Technology and of the federal government, which is also a preferred shareholder -- for $125 million, as I recall -- have been involved in detailed negotiations with Massey during the past 10 weeks. Ontario has had a twofold objective in these discussions: (1) to ensure the long-term jobs of the Massey workers in Brantford, just as our predecessors did, and (2) to try to recoup a portion of the government's $75-million investment in the company. Neither of these objectives will be accomplished easily, given the depressed state of the North American combine harvester market and the resultant financial impact on Massey's earnings.

In 1979, the North American sales of combine harvesters were 40,000 units. This year, in 1985, we estimate unit sales of 10,000. Further complicating this situation is the fact that industry production capacity has remained in the area of 50,000 units, resulting in severe price discounting of combines.

This situation is clearly reflected in Massey's nine-month earnings release, which indicates the company's combines division lost approximately $35 million during that period. As many members of the House are aware, Massey closed its Brantford operations in November to reduce inventories.

It is our view that the failure of Ontario to participate in the company's proposed restructuring would force its creditors to protect their security positions by requiring the permanent closure of the Brantford plant to eliminate these heavy losses. While the restructuring deal itself is complex, the government's options are quite simple. If the restructuring does not proceed, the combines division may close permanently. If the restructuring does proceed, the combines operation will have a chance to survive. The Ontario and federal governments have elected to give Massey and its Brantford workers this chance to survive.

Yesterday, Massey released its third-quarter financial results as well as a brief statement concerning the restructuring. While I am somewhat limited in the specific details I can provide at this time until the final agreement is accepted by all participants, including creditors, I am prepared to offer the members of the House general information about Ontario's position in the matter. Some of the elements of the proposed restructuring plan are as follows:

Massey's combines division will become a privately-held, separate company, with Massey retaining 40 per cent ownership. The balance will be held by lenders and other interests.

The new combines company will be recapitalized and called Massey Combines Corp.

Lenders to Massey Combines Corp. will offer the company low-interest, long-term loans to strengthen its cash-flow position.

All combine-related activities, including research and development, will be centralized in Brantford. Some marketing and parts functions currently operating out of the United States will be moved to Canada. It is expected this will result in the transfer of 240 jobs to the Brantford facility.

The company's break-even level will be reduced significantly, with the result that it will be able to sustain itself even in today's depressed market.

The recapitalization of the combines company will provide sufficient internal funding to cover the significant short-term operating losses which are expected, as well as the one-time costs of rationalizing and centralizing operations in Brantford.

2:20 p.m.

Let me briefly make the House aware of what role Ontario and the federal government are being asked to play in the proposed restructuring. As I stated at the beginning, the province currently holds three million Massey preferred shares with a liquidation value of zero. Under the restructuring, Ontario will transfer a major portion of these shares to the new combines company.

The province is aware that the parent company, Massey-Ferguson Ltd., could become a profitable operation as a result of the deconsolidation of its combines division. The parent company estimates its nine-month earnings without combines at about $36 million. Ontario, therefore, sought and gained a participation in the enhanced earnings which will flow from the restructuring by negotiating to receive preferred shares, common shares and warrants in Massey-Ferguson Ltd.

We believe these actions will restore a portion of Ontario's original $75-million investment in the company, but I will be unable to provide more specific details of the proposal until all participants approve the plan.

Ontario will be putting up no new money in the proposed restructuring; rather, the transaction is an exchange of securities.

For those who might assert that Massey-Ferguson Ltd. is abandoning its combines operations, let me address the point. If there is no restructuring, the likelihood of the combines operation in Brantford ever reopening is questionable; second, Massey will retain 40 per cent ownership in the new company; finally, Massey will be a significant creditor of the new company and the size of this loan will give Massey a strong stake in the new combines company's success.

I will close my remarks by relating to the House some details of the commitments this government sought as consideration for participating in the proposed restructuring.

1. Job commitments: In 1987 Massey Combines Corp. and Massey-Ferguson Ltd. will commit to maintain 500 jobs in Canada; the next year, 1988, the companies will commit to maintain an additional 500 jobs, for a total of 1,000. Thereafter, the companies will maintain an average of at least 1,500 permanent jobs per year in each succeeding two-year period until 1993. The 1987 commencement of these job commitments reflects current market conditions and the expected time necessary to reduce inventories. Failure to achieve these targets will result in financial penalties being imposed on the companies. The job commitment covenants are the collective responsibility of both Massey Combines Corp. and Massey-Ferguson Ltd.

2. Further investment: (a) Massey-Ferguson Ltd. will commit to an incremental investment in Canadian projects of at least $40 million by 1990; (b) Massey Combines Corp. will commit to invest between $30 million and $50 million in upgrading the combine harvester manufacturing business by 1988.

3. Noncompetition clause: Massey-Ferguson Ltd. will covenant not to compete with Massey Combines Corp. in any of its combine harvester product lines.

4. Technology export: Massey-Ferguson Ltd. will covenant not to export the combine technology or enter into coproduction agreements outside Canada without the consent of the government.

REPORT ON OAK RIDGE DIVISION

Hon. Mr. Elston: Services and facilities at the Oak Ridge division of the Penetanguishene Mental Health Centre have been a matter of concern for a number of years. This facility, the only maximum security psychiatric unit in Ontario, treats patients who are either sent for treatment by the courts or transferred from other psychiatric hospitals that are unable to attend to their needs.

In March 1984, following criticisms of conditions at the Oak Ridge division, the Ministry of Health appointed a committee to conduct an independent review. That seven-member committee, composed of national and international experts in the mental health field and chaired by Dr. Stephen Hucker, chief of forensic services at the Clarke Institute of Psychiatry, has prepared its report and today I wish to table it in the House.

The report represents a thorough and comprehensive examination of the Oak Ridge division and provides valuable insights into many of the complex issues surrounding the care and treatment of this patient population.

The committee made a total of 89 recommendations. It suggests, for example, that the number of psychiatrists and staff-to-patient ratios be increased in certain service areas. It also recommends that two streams of training be offered for staff: one for security workers and one for treatment workers. With respect to security, the committee recommends that there be expanded categories for the supervision and treatment of patients and more detailed criteria for their seclusion and restraint.

The committee believes that patients who are not admitted by court order should not be treated at the Oak Ridge division. It suggests that the number of patients in the division be reduced through stricter, more precisely defined admission criteria. It also recommends that facilities at the Oak Ridge division be improved and that the division be administered separately from the regional psychiatric hospital. In addition, more detailed policy and procedure manuals should be developed.

My parliamentary assistant, the member for Wentworth North (Mr. Ward), and David Corder, assistant deputy minister for mental health, visited the Penetanguishene Mental Health Centre yesterday, at my request, to make a preliminary assessment of the report's recommendations.

I intend to establish a steering committee as soon as possible to study the report and devise a plan for the implementation of specific proposals. This steering committee will include representatives from the Ministry of Health, hospital administration and the hospital's community advisory board.

In addition, I will be visiting the facility early in the new year to gather first-hand information about the Oak Ridge division in the light of this new report.

I expect full, constructive and open participation by all concerned as we consider the recommendations.

All those who have participated in this review are to be commended for their fine efforts. Dr. Hucker and his committee did a very thorough job and they received excellent co-operation from staff and patients at Oak Ridge and Penetanguishene Mental Health Centre.

I am optimistic that this report will be extremely useful in improving the conditions for patients and staff at the Oak Ridge division and I plan to move ahead on improvements as quickly as possible.

REPORT ON ENVIRONMENTAL HYPERSENSITIVITY

Hon. Mr. Elston: Members of this House may also recall a six-member committee which was appointed in November 1984 to study a disorder which is known as environmental hypersensitivity, or 20th-century disease. The condition has been described as multiple sensitivities or allergies to a wide range of foods, chemicals and environmental substances.

The disorder does not present a clear-cut clinical picture; the range of symptoms that its victims may have is quite varied. Nor is the disorder recognized by many medical authorities. Despite disagreement among medical practitioners and researchers about the nature of environmental hypersensitivity, however, it is certain that many patients who attribute their ill health to this disorder suffer greatly, and that some of them are seriously disabled.

Therefore, it was decided that the disorder required study and, in November of last year, George Thomson, a former provincial court judge, was appointed chairman of the Committee on Environmental Hypersensitivity.

The committee's mandate was to advise the Ministry of Health on the occurrence of environmental hypersensitivity in Ontario and on current methods of diagnosis and treatment. Further, the committee was to make recommendations to the ministry concerning future approaches to treatment and research that should be taken.

To learn as much as possible about environmental hypersensitivity, the committee held public meetings, reviewed the relevant scientific literature, interviewed many interested people and visited clinics in the United States which specialize in treatment. In addition, the committee received more than 1,000 submissions and thoroughly examined the cases of nearly 200 patients.

Following this extensive investigation, the committee presented its findings to the ministry in a report of more than 300 pages. The report is divided into eight chapters. Its conclusions cover nine major areas and it gives 30 recommendations concerning prevention, research, funding of tests and treatments, information and education about the disorder, as well as financial and social support for patients.

The appendices of the report contain confidential medical and personal information that was provided to the committee by many individuals. Therefore, it was necessary to postpone making the report public, pending permission from those individuals to release this information. This permission has now been obtained and I am pleased to table the committee's report for the information of the members of this House.

The Hospital for Sick Children has been asked to convene an expert panel under Dr. Barry Zimmerman, head of the division of allergy, to review the committee's report and evaluate its recommendations. I hope to be able to advise this House shortly after Christmas as to when we might expect to have the panel's assessment.

ORAL QUESTIONS

URBAN TRANSPORTATION DEVELOPMENT CORP.

Mr. Grossman: I have a question of the Premier on the Urban Transportation Development Corp. I know he does not like to hear about it; I understand that. The Premier should ask John Kruger, he may share some of the information with him.

Earlier today, my office spoke to Bill Waite, president of Siemens Electric Ltd. of Toronto. His company has been actively engaged in discussions with UTDC about forming a consortium to bid on the Dallas transit contract, which no doubt the Premier will know is one of the largest available anywhere in North America.

2:30 p.m.

Mr. Waite told us the competition for the Dallas contract is very active right now, and his concern is that competitors are down there meeting local officials, making their case, and having great success in casting doubts on UTDC because of the meanderings and the fumbling of this government as it threatens to sell UTDC.

Given the fact that Siemens fears it will now lose perhaps 50 jobs as a result of this fumbling and the fact that failure to win the Dallas contract could cost UTDC millions of dollars, why does the Premier continue this charade of fumbling around and trying to sell UTDC simply because it is a pet peeve of the Treasurer (Mr. Nixon)?

Hon. Mr. Peterson: Why is the member blaming the Treasurer for this? The Treasurer is very thoughtful about all of these things and he believes, as the member knows, in the wise use of taxpayers' money. He probably agrees with Jim Snow, the former minister who was responsible for UTDC, who felt it should look at some form of privatization, and that is the reason. I am sure if the honourable member addressed his question to Jim Snow, he would agree with the government looking at all these alternatives.

Mr. Grossman: That is another total nonanswer. Let me refer to one of the few answers the Premier has deemed to give in this House, other than a shrug, about UTDC. On December 10, last week, when I asked about the distribution of confidential information concerning UTDC to a number of competitors, the Premier replied, "Obviously, we would not give away confidential details at this point."

I understand from a morning paper that Mr. Kruger does not share these letters with the Premier, but I have here, once again, some more information he has not been able to get, which is the letter sent out by UTDC with accompanying data.

Given that the Premier told this House he would not give away confidential details at this point, could he explain why it is that UTDC's management forecast, its consolidated statement of income outlining all its expenses and income projections over the next three years, has now been widely distributed to its competitors?

Hon. Mr. Peterson: The answer is no, I cannot. I am sure if it is confidential the Leader of the Opposition would not want to embarrass UTDC by making it public.

Mr. Rae: In the government's own report on the process of privatization, one of the major points made is that it is not helpful for the entire process to have the names of companies identified and to have widespread discretion on the part of the government of the various pros and cons with respect to those companies out in the open for months on end. It is the Premier himself who initiated and publicized the fact that UTDC was on the hit list, without having any particular idea of how privatization would take place so as not to damage its potential marketability and endanger jobs.

Does the Premier not realize the way the government has conducted itself with respect to UTDC has cost jobs and affected the ability of this company to get the kinds of markets it deserves for its products?

Hon. Mr. Peterson: With great respect, I would not agree with the honourable member in that regard. However, his question points out the essential dilemma of a crown corporation.

Here we are in this Legislature discussing this matter day after day, and the member opposite thinks he gets these tasty little morsels he can leak out in this House. He is doing everything he can to embarrass the company. That is fair enough, because there is a system of accountability. When the taxpayers own the company, ultimately they have a right to know.

We are running an open government and we want to share these things with them. We want to share our thoughts with them about the taxpayers' money, and so we are doing that. That is the essential dilemma; the crown corporation is subject to certain strictures and rules to which the companies in private enterprise are not subject, and that is one of the advantages of looking at privatization of this company so it can compete with other private companies around the world.

I think the member's question points out the dilemma and why we are looking for a resolution of this in order to make the company grow.

Mr. Grossman: In order to make this company grow? Let me try this question to the Premier of this government that is so open that John Kruger has not shown the Premier the letter on which he was answering questions in the House yesterday. Let me quote the Premier of this open government again. He said:

"Let me just make one point that is important. The member assumes in its present form it" -- that is, UTDC -- "is just going to continue and get bigger and better... Let me tell him, that assumption is incorrect."

The Premier said that on Monday. I know he has not seen these documents that his open government is playing with, but this document indicates the company will indeed get bigger and better during the next three years, through to 1988, under its current organization and its current management.

Can he explain to me how he can say he must sell this company in order to ensure that it gets bigger and better when UTDC under its current ownership, operation and direction is growing and expanding at a spectacular rate?

Hon. Mr. Peterson: With great respect to my honourable friend, when we look at the contracts that are there in the future over the long run, and when we look at the opinion of certain members of management, in addition to that of certain members who used to be responsible on that member's own side, who feel it should be privatized, why is the member denying them? Has he changed his position? Has his former government changed its position?

Mr. Grossman: No, we did not. We started it. They say in the long term they are doing just fine.

Hon. Mr. Peterson: I am just telling the member we are concerned about the long-term viability of the company. There is no question about that. The long term is not a couple of years; it is much longer than that.

We are concerned about making sure it has the security of contracts so it can continue and be competitive. There is nothing particularly spooky or mysterious about that, and surely the member should know that. He should ask Jimmy Snow if he does not believe me.

Mr. Grossman: The Premier does not have to worry about getting invited to cut the ribbon in Dallas, for two reasons: he will cost us the contract, and there will be another government in place to do it.

DOMED STADIUM

Mr. Grossman: My question to this open government, again to the Premier, is with respect to the domed stadium. Given the fact that the Premier told the member for York South (Mr. Rae) yesterday, and I quote -- it is important to keep quoting the Premier -- "I invite the member to look at every single piece of paper the dome corporation has looked at," will he undertake today not to ask the dome corporation but to guarantee that he will table the report of the technical committee in this House before the last question period of the week? Will he also confirm in the meantime that the document in question contained absolutely no comparative information on the various bids that were before the board?

Hon. Mr. Peterson: Let me assure the Leader of the Opposition that I have no idea what the documents contain. I have not seen them and I am not interested in looking at them.

However, I think the Leader of the Opposition and the members of this House should be. Let me recommend this to him: why does the standing committee on public accounts of this House not summon the technical committee, the board, all the papers, technical reports and anything members want? Call William Davis and Paul Godfrey and have a thorough discussion.

This is a massive public project started some time ago. It is one that has to be scrutinized in every single detail. I know my honourable colleague opposite would not want to do just a superficial little study; he would want to get into it in great depth. I am told there are virtually rooms full of technical material. I invite the member to crawl through it, spend his Christmas holidays working with it if he would like to. He can talk to the dome board and have them here before a committee. I think he would want to do that kind of in-depth analysis.

2:40 p.m.

He would want to talk to some of the various esteemed members of the board. We have a most competent and thoughtful board. He would want to discuss it with William Grenville Davis, QC, Paul Godfrey, Lionel Schipper and others who have contributed so much to making this very thoughtful decision.

Mr. Grossman: The answer the Premier gave to that question was no, he will not table the report in this House.

Let me remind the Premier that over the holidays he may be on the telephone, as he no doubt often is, to Chuck Magwood, Martin Connell and Don Smith. We need information and documents to do the same. Could the Premier undertake to table those documents before the House adjourns this week? Could he confirm before the House adjourns this week that in the general overview presented to the dome board, the technical committee reported that Eastern Construction, not Ellis-Don, had "the lowest adjusted stipulated price"?

Interjections.

Mr. Speaker: Order. With respect, the time is going on.

Mr. Brandt: We want to applaud first.

Mr. Speaker: The usual custom is after.

Hon. Mr. Peterson: My honourable colleague is getting carried away with his own fierceness. I am inviting him to scrutinize the entire deal; I am inviting him to bring it before the public accounts committee.

Mr. Grossman: Will the Premier table the documents?

Hon. Mr. Peterson: I am reminded of when we had this discussion some months ago in this House and the Tory party voted against the suggestion my colleague moved in public accounts then that it be brought before that committee. Here they are tearing it down.

Mr. Grossman: Will the Premier table the documents?

Hon. Mr. Peterson: Now I am saying to them to bring it before the public accounts committee and discuss it.

Mr. Grossman: It is a straight coverup. If the Premier has nothing to hide, he should put the documents on the table.

Hon. Mr. Peterson: If they have some suggestion that Mr. Davis and the members of the technical committee were using undue influence or being partisan, I want them to satisfy themselves. There is not room on that table for all the documents. They can go to look at them and spend all the time they want. I have no problem with tabling them before the public accounts committee, as I have said before.

Mr. Mancini: Mr. Speaker, on a point of privilege: I wonder whether the Premier would consider naming the dome after William Grenville Davis, as was suggested by the Leader of the Opposition.

Mr. Speaker: That is far from being a point of order.

Hon. Mr. Riddell: Call it the Mulroney Dome. It is fully retractable.

Mr. Gillies: Name it the Chrome Dome after the Minister of Agriculture and Food. (Mr. Riddell)

Mr. Speaker: Order.

Mr. Grossman: It is probably going to be Joan's Dome. I will ask the Premier a final supplementary as we try to get him to agree to table the documents of this open government so we can look at them over the next couple of weeks.

In asking for these documents, I want to make a point to the Premier, who is now chatting with the major shareholder of the dome corporation, the Treasurer (Mr. Nixon). He is the major shareholder of the dome corporation.

Hon. Mr. Nixon: The only shareholder.

Mr. Grossman: I ask the Premier to ask the majority shareholder of that corporation, whether he is concerned about the fact that the technical evaluation committee reported to the dome board that the only stadium whose roof opened fully and opened larger than the Ellis-Don roof was "appreciably higher in cost," but did not identify just how much higher in cost it was than the Ellis-Don proposal.

Hon. Mr. Peterson: First of all, with respect to the point of privilege of my honourable colleague, I did suggest at one point some time ago that the dome should be named after William Grenville Davis. However, Mr. Davis, in a fit of modesty, said publicly not very long ago that he did not believe the dome should be named after a living politician. Now we can name it after the Leader of the Opposition or after Brian Mulroney -- it is going to be fully retractable -- or whatever he wants to do.

Let me get back to the point at hand. I do not usually discuss what goes on in our caucus, but we discussed this in caucus this morning and our party was unanimous in the view that on Thursday of this week when the standing committee on public accounts meets, a motion should come forward -- and our party members are prepared to move it -- to bring all of the documents before the public accounts committee.

It is interesting how we have taken the initiative. Even though the Conservative Party refused six or eight months ago to bring this matter before the public accounts committee, we have suggested that it all go there.

Mr. Grossman: What is the Premier hiding? Why does he not send it over?

Hon. Mr. Peterson: This man has no shame. He just keeps yapping. Yap, yap, yap.

Mr. Speaker: Order. I think that is a fairly complete answer.

Mr. Rae: The love affair between the leader of the Tory party and Paul Godfrey can only take off from this point.

EMISSION DISCHARGES

Mr. Rae: My question is to the Minister of the Environment and it concerns the announcement he made today. I would like particularly to focus on the program with respect to Ontario Hydro.

The minister talks in his very glossy statement, Countdown Acid Rain, about two areas of what he describes as flexibility, which I would call two loopholes in the process with respect to Hydro. One of them has to do with this idea of rolling banking credits for emissions over a period of five years. It says here, "Ontario Hydro may be permitted to use credits in advance for a limited number of years."

Can the minister confirm that, as the program is currently designed, it would be possible for Ontario Hydro to apply now in advance for credits not yet earned, which would mean in effect that its emission levels could be higher in 1988 or 1990 than they are today?

Hon. Mr. Bradley: The circumstances in which that would happen, of course, would be circumstances that would be declared something close to a catastrophe in Ontario. As the honourable member would know Ontario is not dependent on the other emitters for electric power. I would indicate to the leader of the third party also that that would require the consent of the government.

We have not indicated at this time any specific numbers for banking, except that we clearly wish Hydro to come back with studies, because I do not look at figures that have been proposed as being satisfactory to me. I want them to be able to come back to us and indicate what they feel, after their studies are completed, would be reasonable figures for them to be able to withdraw from a bank only with the consent of the government and only specified amounts. This, of course, takes into account contingencies that might arise.

2:50 p.m.

Mrs. Grier: I would like to ask the minister about my concern that there be full public discussion and debate when such exemptions are asked for. I have some confidence that as long as the present minister has that responsibility, there will be open government. I am sure that after the next election, when I am the minister, there will be open government.

Should what the minister describes as a catastrophe occur and the minister be somebody to my right, can the minister assure us that there will be public scrutiny of exemptions given to Hydro? If that is the case, why does the regulation he has presented today not spell out any system whereby there might be that full public debate and scrutiny?

Hon. Mr. Bradley: I agree with the critic for the New Democratic Party that a provision for public consultation is necessary. Our government has indicated clearly, since we have been in power and previous to that, our desire to have all the affairs of Ontario Hydro open to the committee system here, whether it be a select committee on energy or a select committee on the environment, which in this case is probably the best vehicle.

A public justification and consultation process is essential if the submissions made by Ontario Hydro are to be believed and scrutinized by all. That is an essential component. I see a legislative committee -- the future committee on the environment is a reasonable one or perhaps the committee on energy -- having that power.

Mr. Andrewes: Since one of the major portions of Hydro's input to this program requires the replacement of coal-fired generation with nuclear generation, can the minister assure us he will move expeditiously on hearings on transmission line facilities that are necessary to maximize the nuclear installations Hydro has and will have in the future?

Hon. Mr. Bradley: I can indicate to the honourable member that the normal process that should take place for those transmission lines will take place. There will be a full consultation process. We will go through the procedures that were established by the Conservative government for that process. The decision made by the board that hears the representations will be the decision this government will ultimately have to live with.

As the member knows from the information provided, we have not stipulated a specific technology that each of the emitters must use. Instead, we have indicated the numbers to those emitters and they will specify the technology. The member will appreciate that the technology is changing rather rapidly. Some methods of reducing acid rain emissions that were not available to us in the past appear to be coming on stream, such as limestone injection. We think a very strong conservation program is an important component, as is the possibility of burning lower sulphur coal and the use of scrubbers. There are a number of options available.

The former minister would not wish to have me as the minister stipulate to Ontario Hydro the specific technology to be used, but rather the total numbers.

Mrs. Grier: The minister has said the regulations contain limits, but can he explain to us why in the case of Inco the target is only an objective and not a limit?

Hon. Mr. Bradley: The limit the government placed on Inco, as it is called today -- I am told I am not supposed to say International Nickel -- is 265 kilotonnes a year. Inco indicated previously that it could reach, or would strive towards, 350 kilotonnes a year. We felt that was not sufficient; so we indicated we wanted to see a regulated 265 kilotonnes.

We also indicated that even though technology in December 1984 did not point to the fact that it could get down to 175 kilotonnes, we nevertheless wanted it to study down to that limit and report back to us on a six-month basis what progress it is making towards both the mandated 265 kilotonnes and the 175 kilotonnes targeted area.

We think all potential emitters should be striving towards something even lower than what we have mandated, although what we have mandated is considerably lower than what anybody countenanced prior to this.

ONTARIO INSTITUTE FOR STUDIES IN EDUCATION

Mr. Rae: I have a question for the Treasurer about an institution that I know is near and dear to his heart. I am talking about the Ontario Institute for Studies in Education.

Is the Treasurer aware that on December 10, 1985, the board of governors of OISE passed seven motions, of which one requested the director not to pursue any further discussions with the University of Toronto about a proposed transfer, while a second requested the Premier (Mr. Peterson) to withdraw the government's policy concerning the transfer of OISE to the University of Toronto?

I hope by now the Treasurer appreciates the degree of chaos and uncertainty he has caused at OISE and in the university community by the manner in which he took his decision. Is he prepared now to do the decent thing and withdraw the government fiat saying OISE is automatically going to be transferred to the U of T?

Hon. Mr. Nixon: I hope I am always prepared to do the decent thing. In answer to the specific matter the honourable member put before the House, I had the experience of listening to the views of a number of people in a capacity audience at the auditorium at OISE, mostly made up of graduates and staff. At that time, I pointed out that in the budget this year we are transferring $2 billion to the post-secondary community, with a $119-million increase this year, and that this is obviously still insufficient.

I made the point that we are going to have to improve the efficiency of the post-secondary system and that it was not really fair to expect the leadership in the universities and various postsecondary institutions to take all the responsibility for initiatives in this very difficult problem. I made the point that I felt it was up to me as Treasurer to take some initiative in that regard. I stated that in discussions with the chairman of the board and the director of OISE I was under the impression, stated by them, that they were going to continue negotiations with the University of Toronto for the next four months.

I indicated that at the beginning of the next fiscal year I would like -- the member is shaking his head; he was not at the meeting and I was.

Mr. Rae: I am telling you what the board passed last week.

Hon. Mr. Nixon: All right, that is fine. They undertook to continue their discussions for four months, until the end of the fiscal year. It was my expectation that the accommodation of the budget would be met at that time, but if it were not, they might very well come back and ask for an extension. Rationally, I have to expect that might happen and there is no problem in that regard, but I do not intend to withdraw that aspect of the budget and the Premier has not brought it to my attention that I should give consideration to the point.

Mr. Rae: The Treasurer is allowing his private irascibility with an institution that goes back 15 years to affect the agenda of university reform and the relationship between universities in Ontario. It is totally inappropriate for that kind of private ill-temperedness with respect to a particular institution to set the agenda for reform in this province with respect to education. It is completely inappropriate.

Mr. Speaker: Is that your supplementary question?

Mr. Rae: Is the Treasurer not aware that as a result of his unilateral, nonconsultative fiat, which he issued in the budget, the board of governors at OISE is sufficiently outraged at the approach the Treasurer has taken to instruct the director, Dr. Shapiro, to stop any discussions with the University of Toronto with respect to transfers? Is he aware that the impact of his announcement has been to bring to a halt any serious discussions between the University of Toronto and OISE?

Hon. Mr. Nixon: I thought it was against the rules here for motives to be imputed, but I will let that go. The honourable leader must be aware that the director was not instructed; he was requested. The board and its chairman are much too wise -- wiser than the leader of the New Democratic Party in that regard -- to issue any such instruction.

3 p.m.

Mr. McFadden: I was at the meeting in question. The Treasurer not only made a number of observations about OISE but also made some other observations about general university planning rationalization. Will the Treasurer confirm in the House now, in view of what he had in the budget, whether he is assuming control over planning of post-secondary education in Ontario?

Hon. Mr. Nixon: No, but I do have the responsibility to provide the funding. In that consideration I must express what I consider must be the concern of the people of Ontario, that our money is spent in the most effective possible way. I am going to continue with that concern.

Mr. Rae: Is it the Treasurer's considered, well-tempered view, as we approach the season of goodwill, that any change in the governance of OISE, and in particular in its relationship with the University of Toronto, will require changes in legislation at the provincial level, since both the University of Toronto and OISE are provincially chartered institutions under provincial statutes? Is it the Treasurer's understanding that it will require statutory change; and is he aware of the opinions of various parties within this Legislature with respect to the unilateral approach he has taken to OISE?

Hon. Mr. Nixon: I am certainly aware of the latter, and I believe statutory changes will be required eventually. I also believe there are ways of adjusting the financing of the organization without that, but I would be very reluctant to undertake those changes.

I would hope rational members of the Legislature might be persuaded to give some reasonable consideration to the fact that allowing the University of Toronto to administer OISE is not tantamount either to reducing its funding or to consigning it to the flames.

RENT REVIEW

Mr. Gordon: I have a question for the Minister of Housing. For years in this province, and particularly in the past few months, the developers have insisted that if controls are extended to post-1975 buildings there will be no building of new rental units in Ontario: I am sure the minister is aware of that. Can the minister explain what the deal is? What secret agreement has he made with the developers?

Hon. Mr. Curling: I appreciate the honourable member's question. There is no secret. It is called consulting, getting people together to resolve the problem. I know it is difficult for that side to understand.

I found the confrontation that existed when I assumed the portfolio was a vicious fight between tenants and landlords and there was no thrust at all from government. I thought if we got together and talked about that, we could start to resolve all the problems we had. The secret deal is to deal with people at a people level and to understand the problems. We are now moving to resolve them.

Mr. Gordon: Will the minister admit that the real deal is that a tradeoff, a sellout of tenants in the pre-1976 buildings, has been arranged; that it is the minister's plan to allow the rents in the pre-1976 buildings to rise to market value and that either the renters are going to pay the new freight or he is going to subsidize it from the rest of the taxpayers of Ontario?

Hon. Mr. Curling: The tenants with whom we sat down were intelligent people. I could not give them a con job because they are very intelligent people. The member will know that the tenants also agree with the deal, as he calls it, but it is just an arrangement that is fair and open. It is very difficult for the member to understand, perhaps because this was not the process in the past. I ask the member to join with me whenever we have any more consultation, and I will tell him how easy it is. We spend our time speaking to the issue, not tearing down walls and having our pictures taken on tractors. We deal with the real issues.

Mr. McClellan: The deal between the Conservatives and the developers was no secret. There was no rent registry; so there was no means of enforcing rent controls.

My question to the Minister of Housing is with respect to his proposed administrative review procedure. How does the minister expect tenants to be able to challenge landlords' costs accurately when there is no hearing, no protection under the rules of evidence and no opportunity for crossexamination? Why does he assume some bureaucrat in his ministry is going to be able to uphold the rights of tenants, which are granted now in the Residential Tenancies Act?

Hon. Mr. Curling: The first approach to a board hearing is a basic review hearing before a rent review adviser, who will make a decision.

Mr. McClellan: By a bureaucrat.

Hon. Mr. Curling: If the tenant or landlord does not like the decision made by the adviser, he has the right to appeal and to go to an appeal hearing review; no one has taken that away.

In the previous situation, it took about 180 days to get one hearing completed. In the second phase, it took about 190 days. We intend to reduce that and to make them less adversarial so we can resolve them in a less costly way.

We have not taken away the rights of tenants. They have the chance to resolve it at an earlier time, and they have the right to appeal it at the Rent Review Hearings Board.

Ms. Fish: Does one have to pay to have an appeal?

Hon. Mr. Curling: If the members listened, they would hear the question answered properly.

Mr. Laughren: Mr. Speaker, on a point of privilege: I feel that my privileges, and I suspect those of other members, have been abused by the Minister of the Environment (Mr. Bradley), who made a major announcement for which there had been a great deal of publicity and then left question period before it was completed. I am offended by that.

PSYCHIATRISTS' SALARIES

Mr. D. S. Cooke: I have a question for the Chairman of Management Board arising from the negotiations, for which I believe she is responsible, that were going on with the psychiatrists at the provincial hospitals. A fact-finder has been appointed. Can the minister guarantee that her government will accept the decisions and recommendations of the fact-finder when the decision comes down?

Hon. Ms. Caplan: Just yesterday, I had an update on the status of the psychiatrists who are civil servants, employees of the government. I understand they have written to the fact-finder. We are awaiting the fact-finder's report.

I want to share with the honourable member my concern about the attitude. I think the House should know that in this situation there are psychiatrists who are civil servants and psychiatrists in the employ of the government who are on contract. Those who are civil servants have the right to pensions and all the benefits of civil servants; with that comes security, and hence lower salaries than for those on contract.

The option or choice is there for those psychiatrists to be either civil servants or on contract. The salary level is around $78,000 at present, plus a benefit package that is worth about 30 per cent to the psychiatrists. I am very concerned about this and I await the fact-finder's report with interest. There are many pressures on this government to deal with salary issues, and this is just one of them.

3:10 p.m.

Mr. Mackenzie: Is the minister aware that the Ontario Psychiatric Hospitals and Hospital Schools Medical Staff Association, along with the Ontario Crown Attorneys' Association, the Ontario Nurses' Association, the Federation of Engineering and Scientific Associations and the Society of Ontario Hydro Professional and Administrative Employees have formed a coalition whose purpose is to try to achieve a certification process that would give them a collective bargaining process? Is the minister ready to intervene with the Minister of Labour (Mr. Wrye) to see that these groups of professional employees do have the same certification procedure that would allow them bargaining rights that workers have in the province?

Hon. Ms. Caplan: The honourable member points out the same pressures from many groups to which I also referred. The answer is no, I do not support that kind of organization for professional groups of civil servants.

I look to the report of the fact-finder in the case of the psychiatrists. We have a negotiating procedure established, and I am very concerned about those kinds of demands and pressures. I believe those people who have the security of the civil service have to be realistic in what they expect the government can provide for them in the way of salaries.

RENTAL ACCOMMODATION

Mr. Gordon: I have another question of the Minister of Housing. In the minister's assured housing program, he tells us he will provide 1,000 rental units from the private sector next year and another 43,000 units over the following four years. Does this gap between next year and the 43,000 units in the next four years come about because the ministry believes the development industry does not yet have confidence in his program?

Hon. Mr. Curling: With all respect, I think the honourable member has not yet read the report. I do not know where he got the figures he quoted, 1,000 next year and 43,000 in four years. Those figures are not correct.

Mr. Gordon: We will leave the minister to go back and read what he has been announcing. Will the minister admit to this House that the reason he is predicting only 1,000 rental units from the private sector next year is that the development industry is still waiting to see whether he keeps his end of the unannounced secret bargain he made to increase rents in those pre-1976 apartment units?

Hon. Mr. Curling: If the question is whether the developers have sufficient confidence in us to build, the answer is yes, they have confidence to build.

Mr. McClellan: Now that my Tory counterpart has joined me in a desire to put landlords in their place and do a terrible number on the development industry, I want to ask the minister why he does not take the $75 million he is pouring down the drain in the Renterprise program and add it to the $72 million being invested in nonprofit housing so he can build 40,000 units of nonprofit housing instead of 20,000 units.

Hon. Mr. Curling: I know my colleague across the floor would love the government to own all the houses, but we know the private sector can generate some affordable units too. We also know one sector alone will not generate all the affordable units we want; so we will spread it around and make everyone contribute to the support of the units we want.

DOMED STADIUM

Mr. Philip: I have a question of the Premier. He will be aware that the interim report of the standing committee on public accounts on the domed stadium made a fairly clear statement that, in its opinion, participation by companies that are not currently involved should be included in the dome. In particular, we named Carling-O'Keefe and Molson's.

Is the Premier aware that Molson's officials claim the consortium, the Stadium Corp. of Ontario Ltd., is still refusing to look at their offer? Is he aware that Carling-O'Keefe, in spite of three written and two verbal offers, still has not had any concrete evidence that the consortium wishes to negotiate with it? If so, what does the Premier intend to do to open up this family compact that was started by the Tories?

Hon. Mr. Peterson: l am waiting at this moment for a report from the stadium corporation with respect to the financing. Let me say generally, in response to the question, I agree with the honourable member that it is obliged to open up and invite more partners into the so-called consortium.

There is a lot of money that still has to be raised from the private sector. I am not in a position to dictate from whom or how much, but the corporation has to look at all of the alternatives. It would be foolish not to look at the two companies the member named.

I have not been involved in the details of that. I am looking forward to a report, but at present it looks as if there is a differential of around $75 million that has to be raised. Obviously, the two companies the member mentioned would be potential sources.

Mr. Philip: is the Premier aware of the accusation made by nonmember firms that the public could lose up to $200 million as a result of the arrangements not being opened up? Is he prepared today to assure this House that he will address the consortium and tell the stadium corporation to open up the negotiations to bring in other companies, and will he keep the cap of $30 million on the original commitment by the province?

Hon. Mr. Peterson: I have heard a number of figures and guesstimates in this entire discussion since the original dream of the dome started. The member will recall the former Treasurer said it was going to cost $150 million. Look what has happened. It is way above that at present.

I know the corporation is concerned about it, and it is dealing with it. I have told it the province will contribute $30 million but it should look to the private sector for other sources of funds. As far as I know, it is doing that. I have no idea where it is going to come from. If the member has any other ideas besides the two corporations he has mentioned, I will pass those on to the corporation.

Mr. Gillies: The Premier contends he wants this information and everything else that the public accounts committee has not yet seen on this matter to be brought before the committee. He may not be aware that the usual practice of the public accounts committee is that a meeting's notice is required for all motions.

Will the Premier commit to the House that he will direct his members on the public accounts committee to agree to unanimous consent that all the information we seek be brought before the committee this week and not into January, as normally would be the case?

Hon. Mr. Peterson: I have no problem with that at all. We were discussing this subject this morning, and I am sure the members from our party are most anxious to have that discussion and to co-operate in any way they can because they believe it should have a full, thorough public input, as the member does. If he can get it organized by this Thursday, that is fine with me. If not, the committee can sit Friday, Saturday, Sunday, Monday, Tuesday -- whenever he wants.

Mr. Gordon: On a point of order, Mr. Speaker: The Minister of Housing (Mr. Curling) implied that the facts given were incorrect. I would like to read those facts with regard to 1,000 units. It is on page 11 of the plan for assuring housing.

"Under the rent review system, the private" --

Mr. Speaker: Order. We will have a new question. The member for Peterborough.

3:20 p.m.

Mr. Turner: I would like to address a question to the Minister of Consumer and Commercial Relations --

Mr. Timbrell: On a point of order, Mr. Speaker: Earlier in the exchange in question period, the Minister of Housing implied that my colleague had not even read the document. Clearly, it is the minister who has not read the document because --

Interjections.

Mr. Speaker: Order. Very interesting points of view. The member for Peterborough with a new question.

Mr. Turner: Is it all right now? Thank you very much.

LOW-ALCOHOL PRODUCTS

Mr. Turner: I have a question of the Minister of Consumer and Commercial Relations, please.

Hon. Mr. Elston: Do not let the member for Don Mills (Mr. Timbrell) interrupt again.

Mr. Turner: I should hope not.

As the minister well knows, the current law permits the sale of alcoholic beverages under one per cent alcoholic volume to anyone in the province, including schoolchildren with 80 cents in their pockets. Is the minister aware of the growing concern among teachers and parents who see grade 1 children consuming such beverages as Sarasoda? How does he plan to deal with this matter?

Hon. Mr. Kwinter: The member for Peterborough has addressed a question that has already been raised in the House. I mentioned to him the last time that the Liquor Control Board of Ontario does not have jurisdiction over those products. As the Minister of Consumer and Commercial Relations, I am quite concerned about it. We are looking at the problem of stomach bitters and all products that fall outside the jurisdiction of the LCBO.

Mr. Turner: I am quite well aware that the question has been asked before. On November 22, the minister said: "It has not been brought to my attention as being a problem. If the member can demonstrate that it is a problem, we will react to it."

I want to make the minister aware that the Addiction Research Foundation has informed me that in a 50-pound child two bottles of this drink of a 0.9 per cent alcoholic volume substance will increase his or her blood alcohol level to the point where an adult driving a car would be charged with being impaired. The foundation recognizes such products as these to be a very real potential concern.

Mr. Speaker: Is your question, "Is the minister aware"?

Mr. Turner: No, it is not. I am just giving him some background.

Mr. Speaker: I am waiting for a supplementary.

Mr. Turner: You remember the way it used to work? I should apologize for being flippant with the Speaker. It is the time of year, I suppose.

In view of these facts, would the minister assure this House the government will reassess its ill-conceived policy of selling beer in corner stores?

Hon. Mr. Kwinter: I do not quite know what the last part had to do with the first part, but I still stand by my offer. If the member will send that information to me, I will have my officials check it out and respond and get back to him on it.

Mr. Swart: The minister has evaded his jurisdictional responsibility by saying it does not come under the Liquor Control Act. That is true, but does he not recognize and agree that he has power under the Minors' Protection Act to prevent children from buying this drink in any store?

Hon. Mr. Kwinter: As I said to the member for Peterborough, I will be very happy to look into it and get back to the members and let them know what we are going to do about it.

REPORT ON FINANCIAL INSTITUTIONS

Mr. Swart: I have another question of the Minister of Consumer and Commercial Relations. He will know there was a recommendation in the Dupré Ontario Task Force on Financial Institutions, which he tabled yesterday, to reduce the full deposit insurance for individuals from $60,000 to $20,000. I am very concerned about that and I think the minister would be as well. I am more concerned because he did not even refer to it in his statement yesterday.

Does the minister not think that, at a time when there have been more failures of banks and trust companies and more difficulties in credit unions than ever before, full deposit insurance coverage at the $60,000 level should remain?

Hon. Mr. Kwinter: All I did yesterday was to inform the members that the report had been released. I did not comment on it in any way other than to commend the members who prepared it and to say my ministry would examine it. That is what we are doing. After we have had a chance to analyse all the recommendations, we will act on some, we will not act on others and we will inform the House when we do.

Mr. Swart: Does the minister not know the concern of the depositors simply because that report of his government has been tabled, particularly depositors in credit unions, over which he has authority? People are already thinking about withdrawing from their larger accounts.

Will he not now reply to this question in this House giving categorical assurance that the people of the province will continue to have full insurance on their deposits up to $60,000 indefinitely?

Hon. Mr. Kwinter: The member is in error when he says it is a report of this government; it was a report to this government. We have not changed anything. We do not plan to change anything until we have reviewed the report.

RED MEAT PLAN

Mr. Stevenson: I have a question for the Minister of Agriculture and Food. It is clear to everyone in the red meat industry that there is great confusion right now about which slaughter cattle will qualify for the 1985 stabilization payments and exactly how those payments are going to be made. Will the minister explain what today's version is of which cattle will qualify for this program?

Hon. Mr. RiddellThe confusion does not arise with the provincial government; it arises with the federal government as to how it is going to pay for the slaughter cattle.

However, there should not be any confusion. The province has said it will pay on a pounds-gained basis, and we are trying to negotiate with the federal minister at the present time the beginning weight for slaughter cattle. We would like to see the weight go to 450 pounds, but it is likely we will have to settle around 475 pounds as the beginning weight for slaughter cattle up to somewhere in the neighbourhood of 1,300 pounds for the final weight. That is the weight range we would like, but it is up to Mr. Wise to make a decision on whether he is prepared to go along with it.

3:30 p.m

REPORT

STANDING COMMITTEE ON ADMINISTRATION OF JUSTICE

Mr. Brandt from the standing committee on administration of justice presented the following report and moved its adoption:

Your committee begs to report the following bill with certain amendments:

Bill 1, An Act to revise the Family Law Reform Act.

Motion agreed to.

Bill ordered for third reading.

MOTION

COMMITTEE SITTING

Hon. Mr. Nixon moved that the standing committee on public accounts be authorized to meet today following routine proceedings.

Hon. Mr. Nixon: Following the discussion in question period and at the suggestion of the House leader of the official opposition, it is suggested they meet briefly so they can order their business for Thursday along the lines of the discussion in question period. I realize this is a bit of an imposition on the members of the committee, but I suggest that a brief meeting might get the matter going to meet the needs of all concerned.

Motion agreed to.

Mr. Harris: Mr. Speaker, on a point of order; it might be a point of information.

Mr. Speaker: I will listen very carefully.

Mr. Harris: It arises out of the previous motion. I understand the clerk is trying to arrange the room right now. Perhaps you will allow the House leader or somebody to announce the room number to the chamber as soon as the clerk gets off the telephone so the members of the public accounts committee will know it.

Hon. Mr. Nixon: The public accounts committee will meet in room 1 when that is convenient for it.

INTRODUCTION OF BILLS

WORKERS' COMPENSATION AMENDMENT ACT

Hon. Mr. Wrye moved, seconded by Mr. Polsinelli, first reading of Bill 81, An Act to amend the Workers' Compensation Act.

Motion agreed to.

LABOUR RELATIONS AMENDMENT ACT

Mr. Mackenzie moved, seconded by Mr. Charlton, first reading of Bill 82, An Act to amend the Labour Relations Act.

Motion agreed to.

Mr. Mackenzie: The purpose of the bill is to prevent the hiring of strikebreakers and to control access to a work premise that is affected by a legal strike or lockout. The bill prohibits the employer from hiring or using the services of a person to do the work of an employee who is on strike or locked out, unless that person is specifically authorized to do so.

Similarly, when a picket line is established at a place of access to a work premise, access is limited to a person specifically authorized by the bill. The bill repeals the provision of the act dealing with professional strikebreakers and strike-related misconduct.

EMPLOYMENT STANDARDS AMENDMENT ACT

Mr. Mackenzie moved, seconded by Mr. Charlton, first reading of Bill 83, An Act to amend the Employment Standards Act.

Motion agreed to.

Mr. Mackenzie: The purpose of the bill is to require an employer to provide a leave of absence to any employee who has been elected to provincial or municipal office so the employee may be able to cant' out the duties of an elected official.

EMPLOYMENT STANDARDS AMENDMENT ACT

Mr. Mackenzie moved, seconded by Mr. Charlton, first reading of Bill 84, An Act to amend the Employment Standards Act. Motion agreed to.

Mr. Mackenzie: The purpose of this bill is to reduce the standard work week from 48 hours to 40 hours in Ontario and to require employers to pay overtime rates for work done in excess of 40 hours per week rather than the current 44 hours per week.

PUBLIC SERVANTS POLITICAL RIGHTS ACT

Mr. Mackenzie moved, seconded by Mr. Charlton, first reading of Bill 85, An Act to provide Political Rights for Public Servants.

Motion agreed to.

Mr. Mackenzie: This bill is designed to give public servants the same political rights all other citizens in Ontario enjoy. It covers civil servants, crown employees, employees of community colleges and people working for agencies such as Ontario Hydro, the Workers' Compensation Board and the Ontario Northland Transportation Commission, but excludes deputy ministers, officers of similar status in crown agencies and other senior policy-making officials.

The deleted sections of the Public Service Act make it illegal for a public servant to canvass on behalf of a candidate in an election, to solicit funds for a political candidate at any time or to speak or write a letter to the editor on any matter that forms part of the platform of a provincial or federal political party. A public servant may become a candidate for election only after the writs are issued and is effectively barred from being a candidate if a nomination is held before that date. The candidate must take a leave of absence without pay for a period of four to five weeks.

The bill provides that public servants will be able to write, speak, contribute, solicit funds, work, join, hold office and vote on behalf of or for or to a political party or candidate in a federal or provincial election, and protects public servants from punitive action by their superiors or from being forced to carry out partisan duties as a condition of their employment.

HEALTH PROTECTION AND PROMOTION AMENDMENT ACT

Mr. D. S. Cooke moved, seconded by Ms. Gigantes, first reading of Bill 86, An Act to amend the Health Protection and Promotion Act.

Motion agreed to.

Mr. D. S. Cooke: The amendment would establish family planning services, more public health education on the prevention and control of lifestyle diseases and prevention of adolescent pregnancies as mandatory services of the public health units in Ontario.

3:40 p.m.

ANSWER TO QUESTION IN ORDERS AND NOTICES

Hon. Mr. Nixon: I wish to table the interim answer to question 107 in Orders and Notices [see Hansard for Friday, December 20].

ORDERS OF THE DAY

House in committee of the whole.

RETAIL SALES TAX AMENDMENT ACT

Resuming consideration of Bill 47, An Act to amend the Retail Sales Tax Act.

On section 3:

Mr. Chairman: I believe when we broke off yesterday the member for Lincoln (Mr. Andrewes) was discussing subsection 3(3) of the bill. Is there anything further?

Mr. Harris: If the Treasurer will not comment further, I will not.

Hon. Mr. Nixon: I have said all I know about it.

Mr. Chairman: Shall subsection 3(3) stand as part of the bill?

All those in favour will please say "aye."

All those opposed will please say "nay."

In my opinion the ayes have it.

Hon. Mr. Nixon: I believe there is agreement in the House that the votes on the committee stages of these bills be stacked for 10:15 this evening.

Vote stacked.

Sections 4 to 11, inclusive, agreed to.

On section 12:

Mr. McCague: For information, why does the Treasurer deem subsection 35(1a) as set forth in section 12 of the bill to be necessary?

Hon. Mr. Nixon: It is evidently possible, if an assessment is made against a taxpayer in this statute, that rather than require a payment in cash, we can accept some other security in payment. I do not know why it is necessary to put it in there, but I do believe we can accept a form of promissory note if an agreement is worked out to extend the payment over a period of time.

My own experience in the Ministry of Revenue, although it is short, has been that from time to time, and more regularly than I had expected -- and this is under the Retail Sales Tax Act -- vendors will be found on inspection to be in default of payment. Sometimes this is because the tax has not been collected, and that is often an instance where particularly a new vendor, or someone who is not conversant with the English language or with any of the languages in which our rules are put out, perhaps makes a mistake and does not collect tax for something that is sold.

For example, I know of an instance where a shoemaker did not realize his services were taxable -- frankly, I did not know it myself -- and the people reviewing this found he was not collecting tax for a taxable service. He speaks English well but does not read it well. We are trying to work out, with the assistance of the member, a situation whereby the onus of payment is reduced somewhat in this case.

There are other instances where the vendor does collect the tax and does not remit. This may be an oversight or it may be that with the pressures of business -- a bank note coming due or some bill coming due where he is going to get into special trouble more onerous than trouble with the Deputy Minister of Revenue, and that is very troublesome indeed -- when the time comes to remit the tax he finds he has already spent the money on something else. The tax has been collected and he does not have the money to remit. Our friendly inspectors go out to discuss it with him.

This is fairly serious because it is not his money, it is my money as Minister of Revenue. Under the law that this Legislature has established, it is taken from the taxpayer and remitted to the Minister of Revenue. It has already been spent on something else. This is fairly serious, in particular if it happens over a period of time and there is some evidence it is not what one would call an oversight, and this happens.

Usually, there is some rational explanation of the situation, and we try to make some arrangement whereby the vendor is not pushed into severe financial dislocation. That is not why we are here; we are here to help. Quite often, a note or some sort of security has to be taken, which is the basis of an arrangement for making the payments extending over a period of time. There are, of course, penalties and sometimes fines.

Mr. McCague: The Treasurer will notice in the explanatory notes it goes even to "mortgage, charge or personal guarantee." What is new about the power that is being granted here, over and above the powers he had before?

Hon. Mr. Nixon: I am informed that the power has been there and is not new. If the member asks me why it appears here, I cannot answer that question. It is not a change, I am informed.

Mr. McCague: Why is it there? Does this give the Treasurer some regulation-making power that he does not currently have?

Hon. Mr. Nixon: I am informed that it is not new. The fact that it is put in here under the explanatory notes for the purposes of this bill is perhaps an error that is not significant; it is not a change. What does legal counsel say about that?

Legal counsel says the Ministry of the Attorney General has suggested that although in general creditors have a right to take security -- and we would be a creditor in that instance -- it is preferable that the crown be specifically empowered. These is no regulation power and no new power; it is what we have been doing. It has been suggested by the law officers of the crown that while it is a proper procedure under law for a creditor to take this security, we should be suitably empowered. My predecessors did this without the specific power.

Mr. Lupusella: I heard the minister, who is also the Treasurer, state that it was the Minister of Revenue's money and not money which --

Hon. Mr. Nixon: Mr. Chairman, on a point of order: That is a phrase which was inappropriate. It is not the money of the Minister of Revenue; it is money for which the Minister of Revenue is responsible in reporting to this House and to the Provinicial Auditor and to that larger jury -- the people. I do not want to stimulate the honourable member because I realize that the remark was perhaps facetious.

3:50 p.m.

Mr. Lupusella: The minister has tried in a very technical way to bypass the situation of this money, but based on the right elucidation of the explanation he gave us, the small businessmen in Ontario are working for the minister to raise this money. They are actually doing the work for the minister. I wonder what they receive in return from the minister for performing that function. As far as the statutes are concerned, it is legitimate for the minister to raise money, but they are performing work for the minister. I wonder what the minister is doing to give something back to them.

Hon. Mr. Nixon: I appreciate what the honourable member has said. Every Saturday morning when I leave my constituency office, I go across the street to a little store and buy the papers and usually have a discussion about sales tax being collected. The owner of the store is a very good businessman indeed, but he usually says, "You collect a lot of tax from me." In a sense that is right, but the tax is being collected from his customers. It is his customers who pay. The vendor collects the money for the Minister of Revenue on behalf of the Treasury of Ontario.

They do work hard and we do not pay them enough, but we do pay them four per cent of their collection with a $16 minimum payment monthly and a $1,000 maximum payment yearly. Interestingly enough, this costs the Treasury $42 million. It is not enough, but it is the highest rate in Canada, although I may be corrected on that. It does cost us $42 million. I wish it could be more, but at least it is a $42-million gesture. They are doing my work for me as the tax collector.

Mr. Lupusella: I appreciate the extension of the explanation of what the minister is doing for them. I did know about that. I am a little bit concerned about the procedure used by the Ministry of Revenue officials when they collect the money from small businessmen in Ontario.

I am extremely concerned in particular about the group of small businessmen on whom, as a result of a computer analysis, as I stated during the course of the estimates of the Minister of Revenue, that ministry comes down with a total of $4,000 or $5,000.

The collection of these taxes for the ministry is legitimate -- there is no dispute about that -- but taking into consideration the location of the businesses and the income the small businessmen get from the items upon which people have to pay sales tax, it appears that even though they have the right to appeal, there is no notice to the small businessmen that he may be in difficulty.

This is a very serious problem if one takes into consideration sources in Ontario which are not extremely productive based on location. There is not much revenue for them in the first place besides collecting sales tax. In relation to this issue, the ministry could be more open in giving alternatives to individual small businessmen to pay the whole amount of money.

During the course of the estimates of the Minister of Revenue, I argued that the computer analysis is used by his officials to get a certain amount of money for a particular year. I hope the ministry will be more tolerant about this issue and try to find out. The small businessmen need this type of attention, and they should not be pressured to pay the whole amount at once.

I would like to bring to the attention of the minister again that even though they have the right to appeal the statement, I am a little bit concerned that in Metropolitan Toronto, or in other remote areas in which a business is not productive, as I stated before, they are compelled to pay this amount of money unless it is appealed.

I hope the minister will do something about it.

Hon. Mr. Nixon: The honourable member is referring to a very important issue. I should just accept it at that, but since there is a lot of widespread concern about it, I will respond more fully.

The idea of a computer riding herd on a small businessman is not attractive. That is true. It is impossible, however, to have individuals go over the monthly or regular returns from each small corner store, confectionery or variety store. While they do not, individually, have large sales and they may be subject to tremendous competition, the member must realize that huge amounts of sales tax come in from those sales. We might as well face it.

Every time they sell some small item -- and they may work hard and terribly long hours -- they collect the seven per cent. It comes in on a monthly basis, and that all adds up to $36 million a day. Some money comes in from the car agencies and all the rest of the businesses that sell big-ticket items, but a huge amount comes from those small sales.

If the small vendor has the impression we are taxing him, that is in error. I have already spoken about that. If he is marking his stuff up by the regular profit, adding seven per cent and considering that his money, then it must tear his heart out every month when he has to send a cheque to the Minister of Revenue. To have that attitude leads to disaster.

Unfortunately, many small businessmen have been faced with this, because while we do not have rooms full of sensitive people who read the returns, phone up and say, "How are you today?" we do have computers that know that for a certain level of sales which is estimated easily, a certain tax revenue in general terms should be produced. When there is a substantial anomaly, we send somebody out to check the situation. That is basically it. It sounds pretty mechanical, but our business is raising revenue to pay for programs for the province. It is a very lucrative source of revenue.

For those people who have gone into business and do not speak English well, we are trying to put out pamphlets and instructions in the language they do read and understand. Many of them are assisted by business organizations. We like to spend time with those organizations so they can pass on what we consider to be an appropriate response to the tax laws of Ontario.

It is very important and I understand it is very sensitive. For example, the most recent publications were translated into Korean because many Koreans immigrating to Canada have gone into the variety store business. They work long hours, give very good service and we appreciate that fact. It is important that they understand our approach to tax collection here, that they are paid to collect the taxes -- I have already said not enough, but it is $42 million a year.

While the member may think we are aggressively intrusive in this, this year the Provincial Auditor gave the Minister of Revenue and his predecessors very severe criticism for not being tough enough. This year's provincial audit indicated we are assessing the responses of our vendors at about 1.6 per cent of our vendor population. He suggested we should be auditing them not at 1.6 per cent, but at 15 per cent of our vendor population.

That is a huge expansion in audit. We would have to hire 200 to 300 additional auditors with accountants' training. They do not necessarily have to be chartered accountants, but they cannot simply walk off the street or out of grade 12 and say, "I want to be an auditor." They must have a professional basis to go out and inspect the books with the authority of the Minister of Revenue.

4 p.m.

On the other side, the Provincial Auditor said we are forgoing as much as $300 million, which is a very large amount of money. He thought if we strengthened the audit we would get that money back. Practically, we have found that by increasing the strength of audits, not only for sales tax but for corporation tax as well, the revenues go up almost arithmetically with the number of audits. I am not sure what that says about the world, but it does not hearten me. We are a very law-abiding community. The avoidance of tax is not sort of a game in this province. People tend to believe they have a responsibility as citizens to pay the proper tax.

We do not feel avoidance is a huge problem, although it is one of concern to the Provincial Auditor and to us. While the member is saying not to be too pushy with these people, the Provincial Auditor is getting very specific in his criticism of the inadequacies of our audit. We are trying to move between those two pressures.

Mr. Lupusella: I do not want to prolong this debate, but I am glad the minister at least recognizes there is a problem that eventually should be corrected. I am sure he recognizes injustices might be committed in pursuing this task of raising sales tax from small businessmen. The previous administration was quite hard on the assessment of property, for example; injustices have been committed there, and we are trying to rectify the situation.

I want to respond briefly to the minister. Even though this task is very important, and there is remuneration going back to the individual working indirectly for the Ministry of Revenue, I remind the minister that the same individual in Europe, by having a licence, is protected from other competitors and his business can be more competitive in the sense that the government does not release the same type of business licence in the same area, which might reduce the profits of the individual.

Here, just for the sake of raising sales tax, one might find 10 or 15 variety stores on a street corner. That is convenient for the Minister of Revenue because in the end he is going to send the assessors to get the sales tax anyway, which is an important task, as I stated, as well as being a legal mandate incorporated in the statutes of Ontario. However, I am concerned for the individual businessman. The government is giving away licences to open stores at a time when statistics indicate we in Ontario are faced with the serious problem of small businessmen closing their stores completely because they cannot compete and are going bankrupt.

In Europe, the individual businessman is protected because the government protects his business by not giving away too many operating licences in the same neighbourhood. That is good business for the government in relation to sales tax, but it is also good business for the individual because he is not faced with so many competitors on the same street. It would be a good way for the minister to plan his government's future policies in that regard.

Section 12 agreed to.

Sections 13 to 15, inclusive, agreed to.

LAND TRANSFER TAX AMENDMENT ACT

Consideration of Bill 48, An Act to amend the Land Transfer Tax Act.

Section 1 agreed to.

On section 2:

Mr. Chairman: Mr. Andrewes moves that subsection 2(1) of the act, as set out in subsection 2(1) of the bill, be amended by adding thereto the following subsection:

"(1b) Notwithstanding subsection 1, where the conveyance being registered is for land that has erected thereon a single family dwelling that is to be the residence of a person tendering the conveyance, and that person is moving from rental accommodation or is a first-time home buyer, the tax payable shall be one per cent of the value of the consideration in excess of $75,000."

Mr. Andrewes: The amendment essentially addresses some concerns we have with respect to housing generally. We heard a fair bit yesterday from the Minister of Housing (Mr. Curling) in announcing a new housing policy for the government. We have sensed that for some time there has been a significant shortage of rental stock in this province, and the amendment addresses an incentive to encourage people to move from rental accommodation to permanent homes.

The housing policy set out by the Minister of Housing yesterday is in many ways a commendable policy. It reflects a number of concerns in the industry and a number of concerns of tenants. However, it is a policy that will be put in place at a substantial cost to the government, to this Treasurer (Mr. Nixon) and to the taxpayers of the province. It alludes to a number of things such as co-operative housing, rent-geared-to-income housing, granny flats and other types of publicly-assisted and nonprofit housing.

Essentially, our concern is that the Treasurer has seen fit to increase the cost of transferring the ownership of real estate, and we are asking him to provide some incentive for renters and first-time home buyers to purchase. It is not a substantial figure. My calculation, which is subject to the scrutiny of the Ministry of Revenue computers, suggests it is worth about $425 per conveyance; but to some, with today's rising costs, every little bit counts, and even $425 might be some incentive towards moving out of rental accommodation and buying that first-time home.

I therefore ask the Treasurer and Minister of Revenue and my colleagues in the New Democratic Party to consider this amendment, particularly at a time when housing issues are very current in this Legislature and are a major part of our day-to-day discussions.

4:10 p.m.

Hon. Mr. Nixon: The honourable member really is exempting homes under $75,000 from any tax, and I can see that this would be very attractive. I wish I could support it.

It is variously estimated. I should introduce to you Derek Rowsell, director of the motor fuels and tobacco tax branch, who is assisting from Revenue, and Leonard Roozen, senior budget adviser, individual and wealth taxation, taxation policy branch at Treasury.

They have costed the amendment -- and I appreciate having had a copy of it yesterday -- at about $30 million. It depends on whether people are moving from apartments into new homes, from smaller homes into larger or whatever. However, the ball-park figure is that it is at least a very significant tax concession. I suppose the member would not have made it if it were not significant and something that would be popular.

I asked for some additional information about it. Essentially, it would be a saving of about $475 on average to a home buyer, which in itself is significant, but I doubt whether it would either draw people into the housing market or keep them out. It would be a significant amount of money, but not a definitive one.

My view is that while it would be nice to give this sort of gift, home ownership incentives apparently are not substantially needed in the present economic environment. I had the great honour of being asked to speak to the Toronto Home Builders' Association last week. In doing some preparation, as I always do for these speeches, and in listening to what they had to say, I was quite pleased to realize they are extremely busy and probably -- I hope -- very prosperous.

They are a bit in short supply of skilled labour because their utilization has increased so rapidly, but they are using a good many Canadian products, particularly lumber, which is priced quite well. In fact, from the lumber point of view it is somewhat depressed. They are using a lot of Canadian products, employing totally Canadian labour, producing well-designed Canadian homes and are not able to produce them fast enough -- in this part of the world, at least -- to meet the demand.

Therefore, while it would be attractive to reduce this as a stimulus to attract people out of apartments and into single-family dwellings or condominiums, we feel it is not economically necessary or even desirable at this time. Interest rates are relatively low in comparison with what many people have been paying on their mortgages in the past few years, and they are dropping slowly. The volatility has gone out of the interest rate fluctuations, we hope for a long period of time, and we hope the drift downward continues. The real estate market is active and getting stronger, and the demand for new units is already outpacing supply.

For those reasons, I am not prepared to accept the amendment.

Mr. Partington: I want to speak briefly in support of the amendment proposed by my colleague the member for Lincoln (Mr. Andrewes) to the original bill, particularly clause 2(1)(c) which increases land transfer tax across the board by 20 per cent by increasing the rate from $4 per $1,000 to $5 per $1,000 on the first $55,000 of property value, and from eight tenths of one per cent to one per cent on all values in excess of $55,000.

I submit to the Treasurer that, contrary to his comments, the tax increase will have an impact on potential purchasers of real property. It is an across-the-board increase of roughly 20 per cent, but as I indicated earlier, since the average resale price of a house in St. Catharines has gone up by approximately 10 per cent between September 1984 and September 1985, the tax on that house will increase by 35 per cent.

A home buyer, who probably got a four per cent increase in pay over the last year, after paying his income tax and all other deductions, has about a three per cent increase. Yet he has to pay a 35 per cent increase in the land transfer tax, and there is no deductibility aspect to that.

I mentioned St. Catharines, but Toronto is no different. In 1984, the average price of a resale home in Toronto, which is a much higher-cost area to live in for some reason, was $102,000. That increased in 1985 to $112,000, which is a 10.3 per cent increase. When we work out the tax on that house, there will be a 34 per cent increase over last year.

In the statement delivered yesterday by the Minister of Housing, he said there is a need to provide a housing policy that is fair and just for all. I would like to ask the Treasurer whether it is fair and just for all to increase the tax on a home purchase by 35 per cent in one year and then by 20 per cent over the traditional tax rates in the ongoing years.

The Minister of Housing said all residents should have access to a basic need; that is, adequate housing at reasonable costs. The challenge is to make basic affordable housing available to everybody in Ontario. We should have a building industry strategy that promotes employment. On the one hand, we should have fair, basic, affordable housing; but on the other hand, purchasers of property have a 35 per cent tax increase.

The member for Lincoln indicated, as I think the Treasurer did, that $475 is the average tax increase. Taken alone, that might not be onerous, but when taken with all the other fees that have to be covered in buying a house, including the mortgage insurance fee of one per cent, survey costs and legal fees, a person buying a $60,000 house and putting $10,000 down sometimes has to put $3,000 up front to buy the house.

In the housing statement we received yesterday, we saw a tremendous emphasis on rent review and on subsidies to encourage refurbishing of old rental buildings. However, there should also be a thrust for the private sector. Instead of having continuing government handouts, this government could let individuals help themselves by withdrawing the tax.

The tax is not the only thing that is discouraging investment in housing. There is the impost fee that municipalities impose at the rate of several thousands of dollars per lot up front. Taken with interest, it makes the burden increasingly difficult when purchasing property.

4:20 p.m.

Hon. Mr. Nixon: Did the member want to refer to legal fees at this time?

Mr. Partington: I did. They are part of the package, but the land transfer tax has far outpaced legal fees in recent years.

The minister has an opportunity to impose a principle that would encourage housing and reduce vacancy rates. I am sure many people would like to move out of rental accommodation and into home ownership. Perhaps a start would be to follow my friend's suggestion of exempting the first $75,000. The Treasurer mentioned that would be $30 million.

We have $500 million in the minister's housing statement, $100 million of which is to pay existing private owners of apartment buildings to renovate their own buildings. They should be doing that out of the rent generated from their buildings. They should not be looking to the government for a handout, or they should not have to.

The $30 million probably would be money well invested. It would increase the availability of rental units, increase jobs and promote this economy.

Mr. Haggerty: It is like legal aid for lawyers.

Mr. Partington: I am thinking about the people in the riding of the member for Erie (Mr. Haggerty) who would like to buy houses and are finding it increasingly difficult to do so. If we were to stop taxing them at a substantially increasing rate, such as 35 per cent in one year, perhaps they could move out of their apartments and into houses, and create more jobs for everyone.

Mr. Haggerty: The same residence or house is $15,000 less in Fort Erie than it is in St. Catharines.

Mr. Partington: But that is a problem I know the member for Erie is going to address one of these days.

In summing up, there seems to be a tremendous conflict between the position of the Treasurer on land transfer tax and the position of the Minister of Housing on housing. We must have a housing policy that is fair and just for all. That requires a fair tax on housing, not a 35 per cent increase.

My colleague the member for Lincoln has submitted a reasonable amendment. There are many things to do. Perhaps the Treasurer should tax a sale. In that way he would get the same amount of money from every house transaction, but it would allow the first-time home buyer to get in without having to cough up money up front.

I suggest the amendment by the member for Lincoln should be supported. That would be in keeping with the housing minister's policy to be fair and just to all, not only renters but also home owners.

Hon. Mr. Nixon: The honourable member spoke as if these were 35 per cent increases. I am informed that the cost of the house would have to be in the $1-million range for the increase to be 35 per cent. The highest percentage is 25 per cent and for a $100,000 house it is 17 per cent.

Although the percentages are larger than I would like, the actual amounts being charged are very little. The increase on a $100,000 house is only $100.

Mr. Partington: If I could reply: in 1984, the average resale home in Toronto was $102,318. In 1985, it was $112,831; an increase of 10.3 per cent. Last year, the tax collected on the average resale house would be $638.50. That is applying the old tax rate on last year's house value.

Hon. Mr. Nixon: The member is factoring in the increase in the value.

Mr. Partington: That is the 35 per cent increase.

Hon. Mr. Nixon: Does the member not want the prices or the resale value to go up?

Mr. Partington: Apart from that, I said in one year it is a 35 per cent increase. Forgetting the one year, overall it is roughly 20 per cent, but this year it is 35 per cent. The increase on $100,000 is from $620 to $725. In one year, the tax burden increases by 35 per cent on the average sale price of a house in Toronto or St. Catharines. But I agree with the Treasurer.

Hon. Mr. Nixon: The sale prices changed during the year.

Mr. Partington: That is right.

Hon. Mr. Nixon: Of course; they have gone up, they have appreciated.

Mr. Partington: But one has the tax and then one has another amount. Anyway, we both understand that.

Mr. Harris: What we both understand and the Treasurer acknowledges -- and he is very proud and pleased and grinning from ear to ear -- is the ad valorem aspect of this tax. He is delighted when it comes to the housing industry and the people who are struggling to move from rental accommodation into the housing market, to fulfil what to many young people and to some not-so-young people is their ambition and dream finally to own a home, so as to be able to take advantage of the increase in value that so many people who are not home owners see others being able to take advantage of.

I sometimes question whether the honourable Monty Python is concerned about some of the crap that is on television these days about buying property for no money down, all based on jumping on and being on the bandwagon.

Mr. Foulds: Did you say Monty Python?

Mr. Harris: I am sorry; Monty Kwinter, Minister of Consumer and Commerical Relations. Excuse me.

I think this is another area the government may want to look into. I believe some misleading statements are being made on air night after night as to how people can --

Hon. Mr. Nixon: The member is watching too much television.

Mr. Harris: I cannot seem to get away from it. I sit there with my flipper and try to flip away from it, but when I get another channel it is on it, too.

It has helped to promote, not necessarily the myth but the fact that if one can manage to own one's own home, it will appreciate in value and be one of the few forms of tax-free appreciation that may be left to one. That is a very desirable goal for many young and older people who have not hitherto been able to own their own homes and experience that great windfall.

Because the land transfer tax is an ad valorem tax, that windfall and increase in value gives the Treasurer an increase in revenue without even increasing the ad valorem percentage he now wishes to apply to the land transfer tax. This is not the only tax increase that bothers me, but it is perhaps the one that bothers me more than any other.

On the one hand, we have the Minister of Housing talking about the great housing crisis and the shortage of apartments. By the same token, we have the Treasurer now not only allowing the ad valorem tax to carry on in the land transfer tax but also increasing the ad valorem tax percentage.

It is a regressive form of taxation that tends to discourage the construction of houses. It is a further impediment in the way of potential tenants and first-time home buyers being able to get out into the marketplace to purchase a first home. I guess the other thing is that it is one of the hidden taxes.

I call it a hidden tax because most people do not even realize it if they are not in the business of buying and selling houses, or unless they have owned a few homes and have finally seen on the bill that comes from the lawyer the land transfer tax component of the lawyer's bill. They are not aware there is such a thing as a land transfer tax. From that point of view, it is an additional hidden tax that perhaps not many people are aware of.

4:30 p.m.

In view not only of this continued ad valorem aspect but also of the increase to the ad valorem, our colleagues took a long look at land transfer tax. We balanced that with what was being done in the housing market and in the availability of rental accommodation, and that is why we devised and moved one of the most progressive amendments that has been before the Legislature this session.

I was out; maybe members to my left in the New Democratic Party spoke already in support of what is a very progressive measure. I apologize. I had to go down to the standing committee on public accounts. If they have not, I am surprised they have not and I hope they will be speaking on this amendment which we tried to provide to them in time so that they could caucus it this morning and see what a progressive amendment it is.

The figures we are talking about exempt the first $75,000 from this ad valorem land transfer tax, only for those moving out of rental accommodation or for those first-time home buyers who, if they are not moving out of rental accommodation, would presumably be moving out of their own home and entering into the marketplace to either rent -- and we all know how difficult the rental situation is -- or buy a home. This exemption will cost the Treasurer $475 per transaction.

Mr. Callahan: Plus several million dollars to police it.

Mr. Harris: I do not think it would cost anything to police it. It is very verifiable. The person would have to provide documentation that his principal residence --

Mr. Andrewes: The lawyer is looking for more work.

Mr. Harris: The member for Brampton (Mr. Callahan) has so little faith in human nature. I do not think it is very difficult to ascertain that somebody's principal residence was a rented premises and he is now going to buy a home.

We are talking about a $475 incentive. What incentive is the government providing to create rental units? One must understand that for $475 worth of encouragement, two things happen. Let us look at the rental side of it. A rental unit is freed up and made available in the marketplace for the sum of $475.

We were witness yesterday to some high-faluting housing policies that talked about providing builders $5,000, $7,000 -- it seemed to me one could get up to $10,000. I do not have the figures in front of me and I confess I have not had an opportunity to read through all the housing information that was tabled yesterday, but we are talking about $8,000 that the government is prepared to give a developer to build a unit, and yet it is not prepared to look favourably on a $475 contribution to encourage a person to vacate a unit, which has the same effect of putting a rental unit on the market.

The Treasurer has said what we are talking about totals $30 million, in rough terms. He is making a projected, ball-park guess in coming up with that $30 million. We see the revenue projections from land transfer tax in the budget will increase by $23 million or $24 million. We are suggesting, in a very progressive amendment, that the Treasurer not increase land transfer tax this year.

The net effect would be to not increase it, except that it will be increased for those who already own a home and are buying another home or for those who are buying expensive homes. There we will see increases in the land transfer tax. In a very narrow-focused, progressive way, the beneficiaries of what we are proposing will be those people who will be able to move into that vacant apartment unit or that rental unit that is vacated and the people who will be encouraged to buy their first homes.

We are talking on the one hand of the government saying, "We are prepared to give grants of $5,000, $7,000, $10,000." I suspect, as the government begins to have difficulties in obtaining anywhere close to the numbers we are talking about, it will probably be willing to offer any amount of money for somebody to build an apartment unit, and yet there is a reluctance to accept an amendment that would cost the government $475 to put that unit out there. At the same time, it would encourage the construction of new housing, the home building industry, the construction and real estate industries, and perhaps lawyers could make even a little more money if there were more transactions taking place in the marketplace.

Mr. Foulds: That might make up for the lost QCs.

Mr. Harris: That is right, and perhaps make up for the cost of removing QC from their letterheads, envelopes, brass plaques and what not.

I would very strongly urge the Treasurer to reconsider his position on this tax. I would very strongly urge my colleagues to the left to take a look at the amendment that has been proposed by my colleague the member for Lincoln.

It is a very progressive amendment that will still leave considerable land transfer tax on those who already have homes and those who are buying expensive homes, but will benefit those people who most need help and will be far more effective in the way of a housing policy and providing rental units across Ontario at far less cost and certainly very minimal, if any, administrative costs compared to the types of elaborate grant programs and schemes that are being proposed by the Minister of Housing.

If he is not prepared to accept this amendment, I look forward to hearing from the Treasurer the reasons he feels so strongly about increasing this ad valorem tax; why he feels so strongly that a $475 cost to the province does not make more sense than an $8,000 or $10,000 cost being proposed by his Minister of Housing.

I will be very interested in hearing from the New Democratic Party, given the new rules of the Legislature, whereby all tax measures are to be decided by a majority of the Legislature and not by the government, the Treasurer or the Premier (Mr. Peterson), why they feel this progressive amendment does not make sense at this time in the history of Ontario and at this point of the chronic and crisis situation we are in, the rental accommodation situation the province has now.

Mr. Foulds: I have listened to the debate on both sides of this question with growing interest and fascination. The amendment put forward by the Progressive Conservative Party is, for them, a substantial move towards progressivity. It is too bad it came while they were in opposition, when they could be fiscally irresponsible.

4:40 p.m.

Taking into account Proudhon's famous dictum about property -- that is Proudhon, the French political philosopher, not Prudhomme the owner of Vineland or a motel down on the Niagara Peninsula -- and taking into account the sense of fiscal responsibility that has always been the hallmark of the New Democratic Party, we believe the clause that is printed in the bill should stand for this budget. I would recommend, however, the modestly progressive idea put forward by the Conservative Party for the consideration of the Treasurer in his next budget.

Mr. Brandt: I am delighted to support the proposed amendment put forward by my colleague, because I am sure the Treasurer is aware that if there is an incentive that should be proposed in this budget, it is one in which the first-time home buyer will be encouraged rather than discouraged to move into his own accommodations.

The amendment very specifically points out that we are talking about people who are moving from rental accommodations to ownership. It calls -- and very wisely, I might add -- for a limitation on the value of that first-time home of $75,000, which does put a ceiling on it. In no way can it be looked upon as being a tax write-off and/or benefit to those who are rich.

I am sure the Treasurer in his wisdom, recognizing the populist positions he puts forward on so many other issues, will recognize the validity of an amendment that encourages those people who are currently renting apartments to move into their own accommodations, their own homes. It is one of the most specific ways, I would suggest to him, that we can ease the rental crisis we have in this province.

We spend all kinds of money on low-cost, geared-to-income rental accommodations and we spend many millions of dollars through grant programs and other inducements to assist those who are living in apartments. Yet one of the most direct ways in which we can ease the kind of crisis we are faced with today is by having some of those people move into their own homes.

There is also a philosophical reason. I do not want to get overly philosophical at this time, but I think any government that does not encourage the ownership of private property, the pride that goes along with owning one's own home, is a government that has really lost sight of what a society should be all about, namely, to accept that kind of responsibility in the light of what it means to the family and to those individuals who are able to move from rental accommodations to their own homes for the first time.

In years past, we in Ontario have recognized that this sense of responsibility is far more direct with people who live in their own homes, and the very specific reason the amendment was put forward by my colleague was to encourage those people to move into their own accommodations and to free up those rental accommodations.

As well, the responsibility factor I touched on is a very real one. People do take pride in home ownership. They do take pride in owning their own little piece of property so they can look after it and take the pride in it that is so valuable in owning property.

That is exactly why the members of the New Democratic Party are having some difficulty in not supporting this amendment. They can see it is an amendment that strikes at the very heart of part of the problem we face in this province, namely, the limited number of rental accommodations we have at the moment and the encouragement we should be providing for people to move into their own homes.

I would strongly urge the Treasurer to reconsider his position and to look at the propriety of the amendment proposed by my colleague. It is certainly an amendment I am very proud to be able to speak to and very proud to be able to support.

Mr. Andrewes: I have just one or two points I wish to add, because it has certainly become clear through the course of this debate that the New Democratic Party is going to decline to be part of progressivity and will leave the bill as it is proposed here and will not support our amendment. It surprises me to some degree, particularly when that party stood up yesterday and applauded this new housing policy.

I could recite at length the current figures and those of October 1983, 1984 and 1985 relative to vacancy rates and the availability of rental accommodation. Here we are providing what we feel to be a very progressive amendment that would not simply assist but also encourage people to seek that final little nest for which they have been looking for quite some time.

Perhaps $475 is not the biggest piece of bait the government could offer people, but it is substantive. In total, the Treasurer has said it would amount to some $30 million. I make a rough calculation that, by way of this increase in the land transfer tax, the Treasurer anticipates an additional $23 million. Of course, that includes rising values in real estate.

However, as my colleague the member for Nipissing (Mr. Harris) has pointed out, what we have done in this proposed amendment is designed to free up rental accommodation and encourage activity in the house building industry. Although the Treasurer tells us that activity is at its peak at the moment, I can hardly believe that a challenged industry like home building in Ontario would not be able to meet a further demand.

The member for Brampton (Mr. Callahan) interjected at one point and started to enumerate the difficulties there would be in attempting to verify how individuals would qualify for this grant. Perhaps that is where the title QC came from. It was the qualification certification. Perhaps the member might want to embark on a little more of that and reinstate his status in that profession.

I have to say that my colleague from Carleton-Grenville (Mr. Sterling) found a novel way to deal with this question of QC. He put a circle around it and drew a line through the circle. I am sure that will now be patented and circulated to all lawyers. They can appropriately stamp their stationery so it meets all the specifications the government has now set down for that industry.

Hon. Mr. Nixon: That would be just enough to justify fee inflation.

Mr. Andrewes: I am told that my colleague the member for Leeds (Mr. Runciman), who wished desperately to speak on this particular amendment, is unavailable at the moment, so we will rest our case.

Hon. Mr. Nixon: Just before the member for Nipissing indulges himself further in his newfound luxury of being in opposition -- I told him he would like it -- I want to say again that I do not mean to imply that the house building industry is fully extended. I do not believe it is. There are not many houses being built in some parts of the country, for example, in Brantford. There are probably some areas in southwestern Ontario with a street of houses where one could buy any one already built for about $45,000 or $50,000. I was talking about metropolitan areas where the business is booming.

I do not really think $475 is enough bait -- I think that was the word the member used -- really to make a vacancy rate of significant proportions in the rental accommodation -- which is certainly under pressure, that is true.

As a matter of fact, I admit the official opposition is very much in the fine tradition it established. One has to go back to 1975, when the then Treasurer, that great budget balancer W. Darcy McKeough, just before we got into an election campaign, dreamt up a concept called the first-time home ownership grant of $1,500 for everybody. In 1975 dollars, that cost about $140 million, which would translate into something under $400 million now.

If we look at the record, there was no indication at that time the home building business needed substantial stimulation. It is hard to determine what the real motive would be for this distribution of $400 million to the province's home owners. That, coupled at the same time with removal of the sales tax from automobiles and white goods for a limited period of six months -- just long enough to be convenient -- added an additional burden to the budget of $600 million, which I think would conservatively translate to about $1.8 billion now.

We can never say the official opposition were pikers in their responsibility in government. I am not sure whether that word is parliamentary, but they were not pikers when it came to buying things they wanted to purchase.

In this instance, the $475 is not really the sort of initiative that is in the tradition of the Conservative Party. I do not think it is necessary and I hope it will not be supported by the House at this time.

In this connection, the member for Port Arthur (Mr. Foulds) was referring to a philosopher named Proudhon, who is his guiding light and guru. In all the banter back and forth about Proudhon, we did not really get the gist of his dictum. But the honourable member said it to me, and it was so much an indication of his philosophy, as well as one the House would find interesting, that I would like to tell members what Proudhon's dictum is. In the words of the honourable member, of course, it is, "All property is theft, so let us tax it." Think of that.

Mr. Foulds: Mr. Chairman, to correct the record --

Mr. Chairman: Correct your own record?

Mr. Foulds: The quotation marks end after "theft."

Mr. Harris: I thank the Treasurer for correcting the record, which I was about to rise and do, for the member for Port Arthur, who had indicated that he wondered why the Conservative Party at this time was coming forth with an amendment of this type. The Treasurer has correctly responded that it is very consistent with policies that this party had taken when it was in government. He referred to the first-time home buyer grant.

It should not surprise the New Democratic Party, then, that we have striven as a party for a long time to try to encourage the availability of housing, the fulfilment of the dream to buy that first home and to alleviate the shortage of rental accommodation. The amendment ought not to be one of surprise to the New Democratic Party. I thank the Treasurer for pointing that out.

Let me go a little bit further, although that is all I had really planned to say. However, in pointing that out to the members of this Legislature, in what I felt was a very arrogant or blatant way, he tried to impugn motives for this party's longstanding commitment to provide assistance to the housing industry and to those people who strive to own their first homes. I think the Treasurer said members of this party were not pikers when it came to standing up for those people trying to buy their first homes or in trying to come forth with programs that would alleviate the critical shortage of housing and rental accommodation. I concur with that.

To impugn any motive other than that is a little insulting to the members of my party and it is very unbecoming of the Treasurer to associate himself with remarks such as that.

Hon. Mr. Nixon: If the shoe fits, wear it. I am sorry to be arrogant.

Mr. Harris: To confirm he was arrogant, he apologized, but he admits he was arrogant in that apology. I hope that interjection is on the record, because I want to refer to it.

The Minister of Housing has now entered the Legislature. I assume he was called in by the Treasurer or by Hershell Ezrin to respond to the amendment we have proposed, as to why $475 is not a meaningful way to try to alleviate the housing shortage problem. I invite the minister to comment on the amendment we are putting forth. On behalf of the government, why does it not make sense?

Hon. Mr. Curling: I will reserve my comments.

Mr. Harris: With great respect, I was inviting comment. I might conclude my remarks by pointing out the Minister of Housing had none. I construe that to mean what he thinks of those high-faluting housing policies that someone wrote for him and which he demonstrated in question period today he had not even read, let alone understood. Someone convinced him that, while they may not solve the housing problem, they will help his political problem of not understanding what the hell is going on in the housing crisis in Ontario.

I regret the minister does not accept my invitation to explain what little he may know. I hope it is more than he demonstrated in question period today.

Mr. Lupusella: Briefly, I would like to bring to the attention of the minister that comments made when members get up from their opposition benches make sense most of the time, especially when the ministers ignore our comments, but we cannot play these types of games at our political convenience.

I think the Treasurer is overly enthusiastic on the issue of collecting taxes in Ontario where citizens are overtaxed. Each item we buy in the house or the land and every time we move, there is a loophole for him to raise taxes all over the place. Even though it makes sense for the Treasury, most of the time it does not make sense for the citizens of the province. When they do something, they are penalized by this extra form of taxation, just because the Treasurer has to increase his revenues and get money from somewhere.

5 p.m.

I would like to discuss with the Treasurer today under Bill 48 the fact that in the past Liberal members showed some sort of concrete concern about land in Ontario that was taken over or transferred to foreign individuals who did not live in Ontario. It was a good way of moving capital from one country to another, using the infrastructure of the existing law in Ontario and getting some financial benefit because they did not actually pay both.

I would support the minister if he increased the amount of tax for foreigners who use the infrastructure or the legal means in Ontario to buy and have land that lies dormant for five to 10 years, because a process of speculation is taking place. In the process, the minister would have an opportunity to increase the amount of tax when land is bought for speculative purposes by these individuals, companies or corporations, which are located not in Ontario but, for example, in Europe or the United States.

The minister is not putting teeth where they are supposed to bite. With this bill, he is penalizing the regular citizen who is buying a parcel of land to build his first house. The biggest speculators are moving and going through land transactions when they do not even live in Ontario. I think the minister has an obligation to raise taxes for those people.

For example, in the past the Liberals complained that our agricultural land is dominated by foreigners and we do not even know who the owners are. The land is dormant; it is not cultivated and is not productive. These land transactions reach millions of dollars. People or corporations located elsewhere, outside the jurisdiction of Ontario, are treated equally to the regular citizen of this province who tries to buy a parcel of land to build his first home. That process is unfair.

Instead of penalizing, overassessing and overtaxing citizens of Ontario, I hope the minister will start tackling the serious problems affecting our economy in the near future.

Mr. Chairman: All those in favour of Mr. Andrewes's amendment to subsection 2(1) of the act, as set out in section 2(1) of the bill, will please say "aye."

All those opposed will please say "nay."

In my opinion the nays have it.

Motion negatived.

Section 2 agreed to.

Sections 3 to 11, inclusive, agreed to.

Bill ordered to be reported.

TOBACCO TAX AMENDMENT ACT

Consideration of Bill 49, An Act to amend the Tobacco Tax Act.

Mr. Chairman: Are there any sections the members wish to refer to, amend or comment on; and if so, which section?

Mr. Lupusella: I have a short comment. I made my remarks on this bill on second reading. I asked the minister whether he could give us a guarantee that he would spend some of the revenue he will get from the Tobacco Tax Act --

Mr. Chairman: Excuse me. I am trying to establish whether there are any sections that any member wants to refer to, amend or comment on. The member for Lincoln (Mr. Andrewes) has indicated he wishes to speak on section 2. Are there any other sections that need attention? No.

Section 1 agreed to.

Mr. Chairman: To which section would the member for Dovercourt like to refer?

Mr. Lupusella: I want to comment on the title of the bill. Perhaps the minister can reply.

Mr. Chairman: The title of the bill is section 10.

Mr. Lupusella: Section 10? Okay, I will wait.

On section 2:

Mr. Andrewes: I rise only to speak in support of the bill. In this bill the Treasurer is planning to forgo some $22 million in revenue from the tobacco tax, to move from $583 million to $561 million.

Hon. Mr. Nixon: The projected revenue is an increase.

Mr. Andrewes: That is not the way it is printed in the budget. It is projected to drop from $583 million in 1984-85 to $561 million, some $22 million.

Hon. Mr. Nixon: That reflects the drop in volume of tobacco. It is an increase in rate.

Mr. Andrewes: It is an increase in rate, but a drop in consumption will offset the revenue.

Hon. Mr. Nixon: I should not have interjected.

Mr. Andrewes: My first question was to try to seek clarification about why the rate increased and yet the revenue fell. That is now clarified.

Generally, this move has been well accepted in the industry, particularly since it comes at a time when that industry faces a good deal of stress. It will perhaps add some stability to the planning of the industry and, I hope, some incentive for the necessary restructuring and rationalization that will go on.

I did notice that the industry has struck a new agreement between the manufacturers and the growers for the 1985 crop. The industry has gone through a very difficult set of negotiations. There has been a fair bit of rancour and long, protracted discussions about the price for the 1985 crop.

The well-structured negotiations that had taken place in prior years -- and there may be some differences of opinion about how well structured those negotiations were -- at least assured that agreements had been entered into before growers went into the fields and planted their crops; they were able to plan their production and their harvest in a reasonably secure environment. That did not take place this year. The board went ahead and allocated a quota to producers but had no guarantee from the processors that quantity would be purchased.

Although this agreement now has been reached whereby 170 million pounds will be purchased from the 1985 crop at a guaranteed price that is above the 1984 level, there is still a good deal of frustration in the industry. Naturally, it comes about as a result of declining consumption and prices, but basically because of declining market potential for a commodity that gave a substantial income over the years to the producers involved.

It used to be the case that products surplus to the domestic requirements -- domestic meaning the Canadian market as a whole, not specifically the Ontario market -- found their way in fair volumes into markets in Britain and elsewhere because of the very high quality of tobacco that was produced here and because it was not grown extensively in other parts of the world.

That has now changed and many of the Third World countries have found that tobacco is a crop they can produce and market effectively and one from which they gain substantial revenues. The Ontario industry, after living through some fairly good times, now finds itself faced with some major difficulties in restructuring.

In the background to all of this is the health debate about the detrimental affects of smoking. My friend the member for Dovercourt no doubt will want to add considerably to that discussion, because he is one of those reformed smokers who is so proud of the fact that he wants to tell everybody about it. There is nothing more sanctimonious than a reformed smoker.

Mr. Foulds: Except a reformed Tory.

Mr. Andrewes: I have gone through the process myself several times and decided I would stop reforming and stop being sanctimonious.

Mr. Foulds: Reformed Tories are pretty sanctimonious today. The exception is the member for Sarnia (Mr. Brandt); it is impossible for him to be sanctimonious.

Mr. Andrewes: I am sure the member for Port Arthur (Mr. Foulds) has done a fair bit of reforming in his time.

Mr. Foulds: Absolutely.

Mr Andrewes: If not, he should start. It feels good once in a while.

The great health debate rages on. There are pros and cons on many sides of that issue, but I think the issue has been joined by municipalities and many municipal politicians who feel compelled to implement anti-smoking bylaws and further restrict the rights of those who indulge periodically.

Hon. Mr. Nixon: Delhi had not passed that yet.

Mr. Andrewes: I do not imagine they smoke around the pumps at Earl's, but I bet a fair cloud drifts out once in a while from the back room.

The search goes on for substitutes to these crops, which have given those who produce them a substantial income over the years. The search goes on for alternatives to tobacco. It is a crop for which one does not need more than about five acres to supply the world, but it is a commodity that no doubt was suitable to the very sandy soils of southwestern Ontario. Therefore, the industry grew up there, and now those who are engaged in it find themselves faced with some rather rigorous adjustments.

The specialized soils and culture that were part and parcel of that industry are forcing those involved to desperately search for alternatives that will not only yield them a reasonable income but yield them an income, period, given that these soils are specialized for tobacco. It is an industry in transition, and it will have to be watched very closely by the Minister of Agriculture and Food (Mr. Riddell) and those responsible for the agricultural industry in this province.

It is also an industry we can be somewhat flippant about. It seems to be popular to be on the side of those who advocate banning smoking and cigarette advertising. However, there are times when many of us recognize that the tobacco industry comes to the rescue of various events that suffer financially, which is often forgotten by those who castigate that industry.

We must be mindful of that. I know the Treasurer is, because he must have a number of constituents who are quietly engaged in this industry. Let us be mindful of the adjustment that needs to take place here and be prepared to ante up when we find our way out of these murky waters.

Mr. Grande: I want to speak briefly to section 2 of this bill on the tobacco tax and the cost that not only the province but also the whole country pays because of tobacco.

I understand what the member who just spoke was saying about protecting and being sensitive to the tobacco farmers in this province. One should be sensitive to them and should see that they do not lose the capital and the money and energy they have invested. However, I am one of the people who believe those farmers should be encouraged to move into other areas of farming.

To that point, and because the member was talking about municipal councils getting into the anti-smoking issue, I want to put on the record the resolution that was endorsed by the city of York board of health regarding tobacco products. Until I read it, I did not appreciate the cost to society as a whole of the weed, the cigarette, tobacco. It says:

"According to Health and Welfare Canada, more than 30,000 Canadians, that is, one Canadian every 70 minutes, die annually from using tobacco products. Although 16 years ago 52 per cent of all adults were smokers and today there is only 36 per cent, the Ontario Flue-Cured Tobacco Growers' Marketing Board has asked Ottawa to set up a national marketing agency; whereas in 1982, according to Health and Welfare Canada, smoking cost the country $7.1 billion in lost income, health costs and fire losses;

"And whereas the industry's benefit to the economy in that same year, including tax revenue, totalled $4.1 billion; and whereas it seems that tobacco imposed a net drain on Canadian society of $2.7 billion, or $700,000 per tobacco farm; and whereas to recommend saving an industry at the cost of increased diseases and death for the rest of the population can only be considered socially irresponsible; and whereas it is well known that the international tobacco companies are trying to make up for declining sales by launching sales drives throughout the Third World, peddling nicotine and high-tar cigarettes;

5:20 p.m.

"Let it be resolved that the board of health recommend to the Minister of Health and Welfare that he: (1) reject the proposal to establish an international marketing agency for tobacco; (2) introduce a comprehensive legislative program to deal with the tobacco epidemic; (3) develop a strategy and program to phase out all tobacco production, in part through assistance to those farmers who shift towards the growing of alternative crops in co-operation with the Ministry of Agriculture and Food; (4) introduce measures to halt the export of Canadian tobacco products in co-operation with the respective ministry;

"and further, that the Board of Health send this resolution to the following organizations for endorsement: the Board of Health for Toronto, North York, East York, Scarborough, Etobicoke, Metropolitan Toronto Liaison Committee, Association of Ontario Boards of Health, etc., and to other individuals, members of provincial parliament" -- myself and the member for York South (Mr. Rae) -- "and members of the federal Parliament, the House of Commons."

I thank members for their indulgence in allowing me to put this on the record. I felt it important that these facts, and basically any facts that come out of the city of York, are good facts to put on the record. The members of the Board of Health of the city of York are to be congratulated for sending us this very important resolution.

Mr. Lupusella: Instead of waiting until section 10, I will make my short remarks based on the speech my colleague the member for Oakwood just made.

The member stated the concern in relation to this problem which is affecting the health of the citizens of this province. As part of the long-term solution to the problems affecting the consumption of tobacco in Ontario, and to protect the health of the citizens of this province, I ask the minister to make a commitment to this Legislature that, based on the revenues he will get from this bill, he will initiate an aggressive campaign to tell the public of this province how dangerous it is to smoke.

The approach used in this type of campaign will actually result in saving of expenditures by the Minister of Health (Mr. Elston) as well. What we are asking for is fair. The government knows how dangerous the consumption of tobacco is, and the government has an obligation to protect the health of the citizens of this province by initiating this aggressive campaign as soon as possible.

Hon. Mr. Nixon: I appreciate the views expressed by the honourable members, particularly the member for Lincoln whose comments were quite helpful in addressing the problem faced by the tobacco industry. The revenues this year are showing a fairly small decline, from $583 million last year to $561 million, but there is a proportion of the sales tax that should be put in there, so the all-in revenue is approximately $600 million. That is a substantial take from the industry.

The sales have been decreasing year by year, by as much as -- at the depth of the decrease -- about four or five per cent. Members might be interested to know that the projection for decrease in sales this year has declined now to about two per cent. The change in attitude of the community continues, not at such a great rate, for reasons that I cannot explain, but it is, apparently, factual.

I join the member for Lincoln in expressing satisfaction that the tobacco growers and the cigarette manufacturers have reached an agreement involving this year's crop of 170 million pounds. We must remember that just a few years ago the crop, and it was all sold, was in the 230 million pound range, so it is down substantially. I expect that next year the Ontario Flue-Cured Tobacco Growers' Marketing Board may decide to approve a somewhat smaller crop projection, although, of course, I do not know about that.

Although there was a good deal of difficulty in the negotiations over many months between the tobacco growers and the manufacturers, and the auction of the tobacco crop did not open at the usual time -- in fact, it has not yet opened, as far as I know -- it may even open a few days before Christmas, but it is more probable it will open early in the new year and the 170 million pounds will be auctioned.

The province was represented by the Minister of Agriculture and Food in these negotiations, but the federal minister took a leading role as well. It was he who got the two sides together in Ottawa and, as he said, put them in a room, locked the door and threw away the key. I do not know whether he literally did that, but I understand the negotiations went on for many hours.

I am quite aware of the importance of the views expressed by the two members from Metropolitan Toronto, and I know they reflect strongly held views by many responsible people. I am not prepared to take sides other than on behalf of my constituents -- my constituents not as Minister of Revenue but as the member for Brant-Oxford-Norfolk.

I invite all members to get in their cars during July and August, assuming the House is not in session, take their families and go for a three- or four-hour drive through rural Ontario --

Mr. Foulds: I did that last summer.

Hon. Mr. Nixon: Okay, very good. Go up through Brantford, see the beautiful Six Nations Indian reserve and stop for tea at the Nixon farm in South Dumfries. My wife will be cutting the lawn, but I will be glad to welcome members. Drive on into Norfolk county, where the tobacco farms are located, meet the people and see what has to be the garden of the universe. It is totally beautiful. There is not a weed; there is nothing out of place. The farms are in perfect order, and over these many years these farmers have been the most profitable in North America, I would say. One cannot possibly question their efficiency and their goodwill.

One can imagine how difficult it is for them to listen to the views expressed that they are growing and selling death. It is a terrible situation on both sides, honestly. I wish I could do something about it. My own projection is that we are going to be selling and using tobacco for a long time, and those tobacco farmers who are established and who are not struggling with the kind of debt that, in our present economic situation, is impossible are going to continue to produce. It may be that governments of the day in the future will decide that some other action should and can be taken. This is quite possible. I invite people to go into that part of the world.

The member for Lincoln mentioned the light soil. I may have mentioned this in the House before, but when I first became interested in politics at the age of six, we would be bundled into the family Essex car -- not everybody remembers those, but they were very smooth and keen -- followed by a DeSoto and then by a LaSalle, and I would go with my father to make constituency calls in that part of the world.

Back in the 1930s, before the tobacco crop, this was a very depressed part of the world because the soil variety, known by professionals such as the member for Lincoln as Fox sand, does not grow very good crops. The farmers tried to grow oats and wheat, have a few cows and some corn and so on, and it was terrible. My dad once mentioned that probably 80 per cent of the people in those rural townships were on relief, as it was referred to in those days. The Fox sand that was not properly tied down by crops or trees -- the trees had been stripped off -- would move in the wind and blow across the roads. It was a terrible moonscape, just awful for the people living there.

5:30 p.m.

In the early 1930s, an experimental attempt to grow tobacco by people from Kentucky was extremely successful and they moved into this area with this crop. At the same time, the government of Ontario began experimenting with reforestation and established one of the earliest reforestation centres at St. Williams, right in the middle of this area. The whole concept was to grow the seedlings and to advise the farmers and assist them in the planting.

Is the member frowning at me and saying this is out of order?

Mr. McClellan: Absolutely not.

Hon. Mr. Nixon: As one drives down the concessions now, one sees the lines of mature trees which not only hold the soil and make the crop possible but make the whole thing one of the most attractive parts of the world. The small villages are like Brigadoon. People have never heard of them, but they are beautiful spots such as La Salette. That is the one I think of particularly because it always votes Liberal, but that is another matter.

I suggest the members go there. Just drive through and talk to the people, look at the crops and see what has been accomplished. When we talk about alternatives, there are none that come anywhere near the ball park in the financial returns these people have grown accustomed to over almost three generations. For us to tell them to stop growing tobacco and start growing tomatoes, wheat, corn, pigs, or whatever --

Mr. Brandt: Peanuts.

Hon. Mr. Nixon: Nuts is right. They cannot take that seriously, although they must, because the returns are somewhere in the region of one fifth to one tenth of what they are used to. That is part of the problem as well.

I am very glad the auctions are about to open. They have an agreement for this year and for next year as well. I expect the poundage that is approved may be somewhat reduced, but at least a semblance of stability has returned to what has been extremely chaotic.

I have been expecting over these last weeks when agreement had not been reached that it would become a real problem here, that there would be effigies of people we all know very well burned out in the front yard, but they went to Ottawa to do that. It may have been as a result of the initiative, such as it was, taken in the bill before us which I earnestly hope and expect the House will support.

Section 2 agreed to.

Sections 3 to 9, inclusive, agreed to.

On section 10:

The Deputy Chairman: I believe the member for Dovercourt wanted to speak.

Mr. Lupusella: It carries because I made my comments under section 2.

Section 10 agreed to.

Bill ordered to be reported.

FUEL TAX AMENDMENT ACT

Consideration of Bill 50, An Act to amend the Fuel Tax Act.

The Deputy Chairman: The member for High Park-Swansea. Which section do you wish to speak on?

Mr. Shymko: I would like your permission to raise a few questions. I am ignorant of some of the side impacts. I am not an expert on energy. I am sure our critic is better versed, but I would like to ask some questions on some of the impacts this bill will have. I did not have the opportunity to do so earlier.

The Deputy Chairman: Will you be speaking on any sections?

Mr. Shymko: As in most cases, I would like to express my comments starting with the first section.

The Deputy Chairman: Is that fine with the Treasurer?

Hon. Mr. Nixon: If it is in order, I agree with it.

Mr. Shymko: Thank you very much.

The Deputy Chairman: Try to direct your questions to specific clauses.

On section 1:

Mr. Shymko: Specific clause 1(t) is related to the Fuel Tax Act, 1981, and is being repealed.

Mr. Andrewes: Mr. Chairman, on a point of order: I do not want to interrupt my colleague, but I want to remind him that we have an amendment to section 2. I am sorry; go ahead.

Mr. Shymko: I am sure there is discretion and flexibility in allowing me to speak on item 1.

We have heard objections from the Canadian Manufacturers' Association, the Ontario Trucking Association and others. I have a question with regard to the impact on transportation. In the annual report of the Ministry of Energy there is a beautiful picture of the minister; he looks serious, and has a mean look, a look of a deep sense of responsibility. I will not read the minister's message.

On page 17, the ministry refers to a program now in existence to replace diesel fuel with propane. "OC Transpo expects fuel costs for buses to drop by about 20 per cent -- or about $4,500 per bus during an active service year...." I imagine this refers to municipal buses that currently operate on diesel fuel.

According to my calculations, the cost to operate a bus with diesel fuel is $22,500 a year if one uses the figures from the report of the Ministry of Energy. An increase of 6.6 per cent, or six cents as the present bill suggests, means that if one uses 250,000 litres per year, there will be an increase of $1,485 a year per bus. If there are 1,000 buses, which is approximately the number for Ontario, this means a $1.5-million increase in the cost of public transportation by buses which are mainly operated by diesel fuel.

Has the Treasurer looked at the impact on municipal transportation costs if my calculation according to the figures used by the Minister of Energy is correct?

Hon. Mr. Nixon: The honourable member points out something that has been raised about other tax bills and is a matter of continuing concern. We apply sales tax to school desks, blackboards and such things. We tax the gasoline that goes into the trucks that sand the roads. In return we provide grants to schools and municipalities that in a sense make up for the tax taken. It is almost out of one pocket and into the other.

It may be that we ought to head for a more appropriate rationalization so that we can cut grants and not take the tax away from them in the first place, but we are building on a design that we inherited. I am not here to criticize it because it has been working reasonably well. It is true that when the Toronto Transit Commission buys diesel fuel for its buses it pays tax on it. We provide substantial grants, 75 per cent capital grants, to assist the TTC in doing what it wants to do. The thing tends to overlap and be blurred by this lack of distinction.

What the member has said is basically true. By increasing these taxes, we increase the costs of operating these services.

5:40 p.m.

Mr. Shymko: Referring to the answer from the Treasurer, I would like to read the impact it will have, as pointed out on June 2, 1981, by a very prominent member of the opposition. That $1.5 million increase will no doubt be passed on to the passengers using the Toronto Transit Commission or public transportation and, in the case of the trucking industry, to consumers. I want to highlight some of the statements made in 1981.

That member of the Legislature said at the time: "The ordinary consumer...is really going to be hit very hard by this consumption tax. The overwhelming sentiment is one of great moral outrage because of the deception," as he called it. "The less charitable people say: `Let the taxpayers or the voters swing for it. Let them pay because they got what they deserved when they voted for this government.'" I refer to none other than the present Premier of Ontario (Mr. Peterson), who said specifically his concern was the impact on the little guy, the consumer.

The difference is that we froze the ad valorem tax for a year and a half at 9.3 cents. It is being increased to 9.9, a six percentage point increase. Such things as public transportation, particularly in an urban metropolis such as Metropolitan Toronto, are of great importance to me.

The present Premier said four years ago, "This new tax, this raid on the consumer, does nothing for oil or energy self-sufficiency. If the Treasurer had come to this House to put that money in a separate self-sufficiency fund for Ontario, putting it into renewables or conservation or methanol or hydrogen or something a little bit creative, he might have had an attentive ear from this side of the House. But the only thing he was creative at was stealing more money from the taxpayers' hides."

This was said by the present Premier, who was very concerned. I think we should remind him of his reference to the Treasurer of the day, because we certainly share those views today, being on this side of the House.

I think the Treasurer should read some of the comments made by his leader back on June 2, 1981. He referred to hydrogen. We know the funding the ministry had been providing for some of the alternative fuels has been cancelled. It is nonexistent as of the fall of 1985. We have eliminated that assistance. Am I correct in assuming the funding that was provided for such experimentations, research and development into hydrogen, has indeed been eliminated? Do we understand the excellent publication of the Ministry of Energy, again signed by the Minister of Energy (Mr. Kerrio), entitled Fuelling Ontario's Future, where he speaks of looking ahead 15 years to the year 2000 and says:

"Hydrogen production methods also provide examples of technologies that could be important in Ontario in the future...hydrogen fuel could be produced in quantity and might find a substantial market in Ontario."

I refer to this tax, the approach, priorities and concerns expressed by the present Premier, the Leader of the Opposition a few years ago, who asked the then Treasurer to give consideration to these priorities. I certainly would like to know whether some retrogressive impact will be felt on some of the research and development for alternative fuels.

The last question and concern I have relates to some of the comments made by the members for northern Ontario, namely, that in the alternative uses of energy in Sudbury there was a project that coupled a 60-kilowatt wind turbine with a diesel generator as a fuel saver for remote sites. This was completed in 1982. I understand these wind turbines are used extensively, are increasing in remote areas of the province and are operated by diesel generators.

It is a concern I am sure the Treasurer has heard before. My question concerns the impact this might have on those particular sources of energy from these wind turbines.

Hon. Mr. Nixon: Did the member say wind turbines?

Mr. Shymko: Wind turbines.

Hon. Mr. Nixon: Wind turbines run by diesel?

Mr. Shymko: Right. We get energy from wind, and these turbines are coupled to a diesel generator which uses diesel fuel to operate. That is my understanding.

Hon. Mr. Nixon: The diesel generator runs the windmill and it spins?

Mr. Pope: No, no.

Mr. Shymko: I think some members from northern Ontario who may be more familiar with this could explain it to the Treasurer.

Hon. Mr. Nixon: Perhaps I could assist by telling the member that diesel fuel used for that purpose would be tax-free; that is, no tax. May I respond to the other points? No?

When my leader, the former Leader of the Opposition, made the speech in 1981 from which the member quoted, it was when the ad valorem tax was first imposed. My leader made those points because he was projecting and predicting exactly what did happen. Without ever coming to the Legislature again to be adjusted or reviewed in any way, the tax was automatically raised from what it was then, 19 cents a gallon, to about 37 cents a gallon, which is a 100 per cent increase -- double. This was without it every coming back to the House.

My leader was entirely correct when he said this would have a particularly bad effect on the people who were driving in this city and elsewhere. I certainly do not apologize or in any way try to defend what he said because it was entirely correct. I think he would say exactly the same thing now. That is why we have made such a commitment to removing the ad valorem, even though it is not going to change the revenue. That is something else.

Mr. Pope: Do you mean you are against indexing?

Hon. Mr. Nixon: Yes, we are; no, we are not. There was another point the member made on hydrogen. There was some thought a commitment should be made to hydrogen research. A little while ago, I made a point that when the members opposite were in government, they certainly could not be called pikers.

In the election of 1975, they made an additional six-month-only commitment of $1.8 billion to enrich the payouts from the government. However, one could never say they lacked imagination either. At the same time, they undertook hydrogen research and they undertook the drilling of dry holes in the offshore Arctic. We have committed many millions of dollars to these holes in the ground.

An hon member: Where?

Hon. Mr. Nixon: I do not know where. The former government paid for them and now people want me to pay for more. I tell this House we have stopped paying for more, even though there is always somebody saying the next one is going to be a gusher. Does the member know that feeling? Maybe we should do one more and that will pay for the whole thing. We have stopped that.

It was this same commitment, this same attitude, this invigorating and refreshing leap into the dark that was characterized by the purchase of Suncor. It might have been great, but it was not great.

Unfortunately, so far the same must be said for hydrogen research. The thing that really put steam in that idea was a huge extra ability to produce electrical energy. The Premier of the day said: "We are going to electrify the trains running in all directions. We are going to make hydrogen from the electrolysis of water." If members remember grade 10 science, that would use a lot of electricity. I think he was going to put electricity in green garbage bags and ship it to Greenland at low cost or whatever he could do.

5:50 p.m.

If there was anything the former government could do to use electricity, he was in favour of it. We spent a lot of money on hydrogen research. As a type of scientist myself -- an old scientist -- it sounds good. We know what happened to the Hindenburg. Everybody says, "Oh, hydrogen, you have to watch that." However, in modern terms, hydrogen should be a very good fuel indeed for lots of things.

To answer the member's question, the research we funded has unfortunately not been what one would call spectacularly productive so far. It has been hit on the head.

Mr. Shymko: I understand from the comments of the Treasurer that he is against indexing. Is that my understanding? Is the Treasurer on the public record with the comments he just made, that on principle he is opposed to any form of indexing? That point should be well recorded by Hansard.

Mr. Chairman: Order. I do not see how that has anything to do with the change to replace the ad valorem tax.

Mr. Shymko: I will conclude by asking the Treasurer when will the wind turbines I referred to be exempted from the six per cent increase in diesel fuel? Will he not contemplate allowing buses that run on diesel fuel to be exempt from this bill in the same way diesel trains are? Will he not agree with the statement made on June 2, 1981, that his tax will dampen consumption, be inflationary, rob disposable income, help create a recession and definitely not do anything to stimulate consumption?

Does he agree, as has been said by the former Leader of the Opposition and the present Premier, that this is a cynical tax and that people feel deceived? They feel they have been virtually lied to. I use that word advisedly. They wake up in the shock of a budget and ask themselves, "How could we possibly have been taken in by those people?"

I want to know whether he agrees with the words of wisdom of the present Premier, his leader and the former Leader of the Opposition, on this same issue of fuel tax.

Hon. Mr. Nixon: I do.

Section 1 agreed to.

On section 2:

Mr. Chairman: Mr. Andrewes moves that subsection 4(1) of the act as set out in section 2 of the bill be struck out and the following substituted therefor:

"(1) Every collector, importer, registered consumer and purchaser shall pay to the Treasurer a tax at,

"(a) a rate that is the lesser of 9.03 cents per litre on each litre of clear fuel or 16.5 per cent of the average monthly retail price per litre of all clear fuel received or used by him or her in Ontario to generate power in a motor vehicle other than railway equipment operated on rails in connection with a public transportation system;

"(b) the rate of 3.1 cents per litre on each litre of clear fuel received or used by him or her in Ontario to propel railway equipment on rails where such equipment is operated in connection with and as part of the public transportation system.

Interjections.

Mr. Andrewes: Do not get too anxious. We are not finished yet.

The purpose of this amendment is to roll back the fuel tax to the rate that was in place before this budget and to implement a system by which, as fuel prices decline, the percentage of tax declines. It is a measure we feel bears a good deal of consideration. At some point later in the evening I would like to present some rather convincing arguments to the Treasurer and my colleagues that would invite their support for this amendment. Should I do it now?

Mr. Foulds: Do it now so we can consider it over the supper hour.

Hon. Mr. Nixon: Are you thinking of adjourning?

Mr. Chairman: Leaving the chair.

Hon. Mr. Nixon: I just want to point out to the honourable member, in the spirit of Christmas --

Mr. Hennessy: Ho, ho, ho.

Hon. Mr. Nixon: Ho, ho. If the work continues in this moderate and rational way with ample debate, however moving, it is possible that we might be able to get on to some other orders of business before the close of business at 10:15 p.m.

Following the revenue bills, after Bill 51, if we were to get that far, and whatever the members say is okay with me, interim supply will follow. That will only take a few seconds. That is to be followed by Bill 77, which is the bill having to do with triggering rent review at four per cent and capping the pass-through at five per cent, in case the members would like to proceed with that. We propose, members dispose, for the time being.

The House recessed at 6 p.m.