SAVINGS AND RESTRUCTURING ACT, 1995 / LOI DE 1995 SUR LES ÉCONOMIES ET LA RESTRUCTURATION

ALLIANCE OF SENIORS TO PROTECT CANADA'S SOCIAL PROGRAMS

ASSOCIATION OF MUNICIPALITIES OF ONTARIO

OAKVILLE CHAMBER OF COMMERCE

PETER TABUNS

BRAMPTON BOARD OF TRADE

PROSPECTORS AND DEVELOPERS ASSOCIATION OF CANADA

PHIL CUMMING
DAVID SHARPE

DUNCAN MACDONELL

CANADIAN FEDERATION OF INDEPENDENT BUSINESS

METRO TORONTO COALITION FOR BETTER CHILD CARE

HANOCH BORDAN

REGIONAL MUNICIPALITY OF YORK

ONTARIO ASSOCIATION OF POLICE SERVICES BOARDS

CHRIS ARCHER

ELIZABETH ROWLEY
ELIZABETH HILL

TOWN OF PENETANGUISHENE

CONTENTS

Thursday 21 December 1995

Savings and Restructuring Act, 1995, Bill 26, Mr Eves / Loi de 1995 sur les économies

et la restructuration, projet de loi 26, M. Eves

Alliance of Seniors to Protect Canada's Social Programs

Jim Buller, program coordinator

Association of Municipalities of Ontario

Terry Mundell, president

Michael Power, first vice-president

Oakville Chamber of Commerce

Peter Warmels, president

Peter Tabuns

Brampton Board of Trade

Bob Malcolmson, policy analyst

Prospectors and Developers Association of Canada

R.H. Tays, director

Wally Rayner, director

Phil Cumming; David Sharpe

Duncan MacDonell

Canadian Federation of Independent Business

Catherine Swift, president

Judith Andrew, director of provincial policy with special responsibility for Ontario

Metro Toronto Coalition for Better Child Care

Katheryne Schulz, public education coordinator

Hanoch Bordan

Regional Municipality of York

Eldred King, regional chair

Ontario Association of Police Services Boards

Bruce Stewart, legal counsel

Mr Justice H. Ward Allen, honorary counsel

Chris Archer

Elizabeth Rowley; Elizabeth Hill

Town of Penetanguishene

Bob Klug, mayor

George Vadeboncoeur, CAO

EVIDENCE SUBCOMMITTEE

STANDING COMMITTEE ON GENERAL GOVERNMENT

Chair / Président: Maves, Bart (Niagara Falls PC)

Vice-Chair / Vice-Président: Tascona, Joseph N. (Simcoe Centre / -Centre PC)

Flaherty, Jim (Durham Centre / -Centre PC)

Grandmaître, Bernard (Ottawa East / -Est L)

*Hardeman, Ernie (Oxford PC)

*Maves, Bart (Niagara Falls PC)

Pupatello, Sandra (Windsor-Sandwich L)

*Tascona, Joseph N. (Simcoe Centre / -Centre PC)

Wood, Len (Cochrane North / -Nord ND)

*Young, Terence H. (Halton Centre / -Centre PC)

*In attendance / présents

Substitutions present / Membres remplaçants présents:

Cooke, David S. (Windsor-Riverside ND) for Mr Wood

Crozier, Bruce (Essex South / -Sud L) for Mrs Pupatello

Phillips, Gerry (Scarborough-Agincourt L) for Mr Grandmaître

Sampson, Rob (Mississauga West / -Ouest PC) for Mr Flaherty

Also taking part / Autre participants et participantes:

Colle, Mike (Oakwood L)

Ecker, Janet (Durham West / -Ouest PC)

Silipo, Tony (Dovercourt ND)

Clerk / Greffière: Mellor, Lynn

Clerk pro tem / Greffière par intérim: Deller, Deborah

Staff / Personnel:

Pond, David, research officer, Legislative Research Service

Richmond, Jerry, research officer, Legislative Research Service

The subcommittee met at 0931 in room 151.

SAVINGS AND RESTRUCTURING ACT, 1995 / LOI DE 1995 SUR LES ÉCONOMIES ET LA RESTRUCTURATION

Consideration of Bill 26, An Act to achieve Fiscal Savings and to promote Economic Prosperity through Public Sector Restructuring, Streamlining and Efficiency and to implement other aspects of the Government's Economic Agenda / Projet de loi 26, Loi visant à réaliser des économies budgétaires et à favoriser la prospérité économique par la restructuration, la rationalisation et l'efficience du secteur public et visant à mettre en oeuvre d'autres aspects du programme économique du gouvernement.

ALLIANCE OF SENIORS TO PROTECT CANADA'S SOCIAL PROGRAMS

The Chair (Mr Bart Maves): Good morning, ladies and gentlemen. Would the member from the Alliance of Seniors to Protect Canada's Social Programs please come forward. Good morning, sir. Welcome to the standing committee on general government. This morning you'll have half an hour to make your presentation. You may want to leave some time at the end of your presentation for some response and questions from the three caucuses. I'd appreciate it if you'd read your name and your organization into the record.

Mr Jim Buller: That is a typographical error. It's not Tim; it's Jim.

The Chair: It's Jim Buller, the program coordinator. You can begin at any time, sir.

Mr Buller: I'll have a few additional things to bring before the committee following the formal submission which might assist the committee in analysing the potential impact of this bill.

Our alliance is an advocacy coalition which has worked closely with the Ontario Coalition of Senior Citizens' Organizations and the Social Planning Council of Metropolitan Toronto. We have led delegations to most of the federal MPs in the Metropolitan Toronto area and also lobbied MPs at the national federal Liberal caucus in Toronto last February, prior to the presentation of the 1995 federal budget.

Our alliance opposed the regressive block funding cuts of some $6 billion to the provinces -- and I believe it's even greater than that; I think it's closer to $7 billion -- which undermine our social programs, which are the very glue that holds Canada together. Foremost among the social programs is medicare, with its national standards as enshrined in the Canada Health Act. The provinces deliver the social programs which are partially funded by the federal government.

We feel that Bill 26 goes far beyond what is considered acceptable by undermining many vital services which are absolutely essential for Ontarians.

The imposition of user fees for prescription drugs, as well as the deregulation of drug prices, is a capitulation to the drug manufacturers and will undoubtedly result in higher drug prices for Ontarians, especially seniors and the most needy. All other provinces regulate drug prices.

I might add, just as an aside, that last Saturday our alliance met with the Honourable Douglas Peters, who is the federal Secretary of State for International Financial Institutions, and we discussed the patent drug legislation that the federal government has. This was amended during the Mulroney years. The powerful drug lobby was able to get a 20-year monopoly on patent drug prices that would exclude the generic varieties, which are lower-priced. His response, and you might all be interested in this, was that the drug manufacturers have a very powerful lobby and the federal government found it very difficult -- and this goes back to the era of the Conservative government as well -- to resist this powerful corporate lobby. I think that's very well worth noting.

The need to reduce the deficit can be assisted greatly by adopting a fair tax system for Ontario. In submissions to the federal Finance minister, we proposed closing the numerous corporate tax loopholes and subsidies which permit many highly profitable corporations to pay little or no corporate income tax. This can be partially corrected provincially by increasing the Ontario minimum corporate tax rate to 10%. Low-income Ontario residents, with incomes as low as $11,000, pay income tax at the rate of 17%, even though they are at the poverty level.

Furthermore, the provincial Treasurer and cabinet would do well to note that well-off, wealthy Ontarians received a 26% cut in federal personal income tax in the early 1980s. That's an enormous cut in taxes. Therefore, the 30% tax cut is not needed, and Ontario cannot afford it, as it will increase the fiscal deficit even further, as well as the provincial debt.

Rather, the government would be well advised to concentrate on real job creation initiatives and amend the Employment Standards Act to reduce the work week in line with the recommendations of the Donner report. That was a federal report commissioned by Human Resources Minister Axworthy.

I might add that one of the recommendations in that report for job creation, which Premier Harris was very, very concerned about in the story in this morning's Toronto Star, would be a reduction in hours in the Employment Standards Act. We recommended this to the previous provincial Labour minister. We also feel it has great merit. But it seems that the large corporate sector wants to have, rather than shorter hours, longer hours.

I have here -- I just want to draw your attention to it -- the front page of the Star. You will probably all remember this, when the job applicants were lining up to get job applications to get a job at General Motors, in bitter cold weather a year ago. General Motors was handing out job applications. But rather than creating jobs, they have applied to this government to extend the work week, with a lot of overtime, to 56 hours a week. This request should be denied. They should be told by the government that they have a responsibility to create jobs rather than eliminate jobs.

You might have the photocopy of the jobs that have been slashed by the Business Council on National Issues. They have their corporations, and they have a great many of them -- the major corporations in Canada. They appeared before the House of Commons standing committee on finance recently; it was televised. Tom d'Aquino was asked by the chairman of the committee, "How are you going to create jobs?" His answer was, "We're going to create jobs vicariously." So we went to the dictionary, and this is the definition of "vicarious" -- "an imagined participation in an experience not his own." That was the definition of "vicarious." At that point, the finance committee, when I drew this to their attention, broke out into laughter, and so did the audience. In other words, they haven't created jobs, they've slashed jobs, which is the exact opposite to what the Premier professes to want so much and which Ontario needs.

We feel the provincial government can assist in job creation by looking at a shorter work week. The Employment Standards Act has not been amended in decades. This would be a great help in job creation.

The impact of welfare cuts on recipients, particularly children, is very harmful and will increase poverty and hunger as well as adversely affecting the health of welfare recipients.

Schedule L of the bill, which amends the Public Service Pension Act and the Ontario Public Service Employees' Union Pension Act, would deny full pension benefits to possibly as many as 20,000 government employees. This is described by Thomas Walkom in the Toronto Star of December 7, 1995, as follows: "In effect, it will be able to cheat public service pensioners of between $400 million and $500 million worth of the money owed them." These amendments are retroactive to the day the OPSEU plan was established, on January 1, 1993.

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Schedule M of the bill amends the Municipal Act and 12 other statutes relating to municipalities, conservation authorities, transportation and other matters.

Section 33 makes privatization of public utilities, including electricity, water, sewer or transportation services, much easier, with resulting higher costs to municipal ratepayers, another form of tax hike, along with possible user fees for libraries, parks, garbage collection and prescription drugs -- all forms of tax increases due to enormous impending funding cuts by the province to the municipalities.

Seniors and the disabled are now losing the TTC Wheel-Trans taxi service due to provincial funding cuts to the Toronto Transit Commission, with a fare increase and service cuts due shortly.

Taxes are going up while services are being cut, all because the province wishes to give a 30% tax cut to the wealthy.

The downloading of reduced funding by the province to the municipalities forces them to increase taxes or impose user fees, or both, which was not supposed to be part of the so-called Common Sense Revolution. Otherwise, vital essential municipal services might have to be cut or eliminated. This is a huge step backwards. The government cannot reduce the deficit by cutting taxes to the wealthy by 30% while cutting funding to the municipalities.

All members of this committee would do well to read and study the exposé of our tax systems contained in Linda McQuaig's books, Behind Closed Doors and Shooting the Hippo, which deal with taxes and deficits. I might add that in the book Behind Closed Doors, this reveals how the 10 federal personal income tax categories were reduced to three, which resulted in a shift of the tax burden to lower-income people, with a very substantial cut in the tax burden to the very well-to-do.

I'd also mention to you another book which is worth reading, by William Krehm, A Power Unto Itself: The Bank of Canada, The Threat to Our Nation's Economy, because it reveals that when the Second World War ended, the Bank of Canada was able to offer very low interest rates to the federal and provincial governments, as low as 1% and 2%, which eliminated the debt. In other words, this could be done again. There are other ways to reduce the debt and the deficit.

In conclusion, the sweeping powers granted the Municipal Affairs and Health ministers and the cabinet to close hospitals and amalgamate municipalities are extreme, excessive and dangerous. The haste to rush through the passage of this sweeping bill without proper hearings and consultations is dictatorial and a negation of democratic parliamentary practice.

Bill 26 undoes much of the decent legislative initiatives of previous governments, including Conservative governments. It should be withdrawn in the interests of the public good. This human deficit that this bill would create is much greater than the fiscal deficit, which can be reduced by fair taxation. This is all respectfully submitted.

I'd also like to draw your attention to a very important experience that was initiated in New Zealand about 11 years ago. This was an effort supposedly to reduce the deficit, and it was shock therapy. Some economists called it voodoo economics. Before 1984, New Zealand had the third-highest standard of living in the world, the lowest unemployment rate in the industrialized world, almost no violent crime -- personal security was taken for granted -- the foreign debt amounted to $20 billion and the total public debt stood at $11 billion.

The shock therapy of 1984 saw a 50% tax reduction for the wealthy; a fire sale of $19 billion in government-owned assets, including Air New Zealand, the telephone system, the government insurance agency; and the downsizing of most government services. They closed 70% of all post offices in one day, the railway staffs were cut, TV New Zealand was sold off or cut by half, the funding, and the staff was cut by half; this might have a certain parallel with TVOntario. Half the jobs in the manufacturing sector evaporated and a quarter of a million people had to leave the country in order to find work.

So this shock therapy was all designed to reduce the deficit. What happened? The foreign debt more than tripled to $70 billion. The total public debt jumped almost 350% to $38 billion. The reason for all this type of slash and burn and privatization and tax cuts for the wealthy was to reduce the deficit and reduce the debt. It did the exact opposite. It put New Zealand into a depression and it became an economic basket case for 10 years.

This bill is very similar to what was done in New Zealand and it will not have the desired effects. It will only cause tremendous economic hardship and suffering, and it deserves reconsideration. We feel the bill should be split up and ample opportunity, additional opportunity, should be given for proper discussion and examination.

I was notified of this hearing at 5 o'clock yesterday evening to be here at 9:30 in the morning, and I only got this time because I phoned several times during the day to find out when I'd be appearing.

I'd be only too happy to answer your questions. I also have here what is called Unfair Shares: Corporations and Taxation in Canada. This has the database from the Globe and Mail Report on Business on those corporations and what taxes they pay. Twenty-one per cent of profitable corporations pay no corporate income tax, and many of them that do pay as little as 1% and 2%. I'm prepared to give this to the committee for their use. If you wish an extra photocopy, I have one here. It might be of some assistance to you.

If you have any questions, I'd be only too happy to attempt to answer them.

The Chair: Thank you, Mr Buller. We have about four minutes per caucus. We'll start off with Mr Sampson from the government caucus.

Mr Rob Sampson (Mississauga West): Thank you very much: a good presentation, as you normally do. I think I've had one from you before with respect to auto insurance.

Mr Buller: That's right. I knew your face looked familiar.

Mr Sampson: I want to comment just briefly on this chart that you brought to our attention. It certainly on the surface indicates significant reduction in jobs between 1988 and 1994, but I think one has to be careful in taking a look at the comparisons, because the companies listed here have significantly changed over the space of the six years or so of the analysis. I only know of some of them here because of my previous job in looking at companies involved in the forest products sector.

For instance, Abitibi-Price: It says here they went from 16,000 to basically 6,000 jobs. Abitibi-Price between 1988 and 1994 basically sold one third of its business. So if you're taking the data from annual reports, which is, I gather, what the source of this information is, what you're going to be missing --

Mr Buller: That's originally from the Financial Post, I believe, but it was compiled by the Canadian Centre for Policy Alternatives.

Mr Sampson: Right, but what I'm saying is that to compare Abitibi-Price from 1988 to 1994 without giving recognition to the fact that they have sold about a third of their businesses and downsized from a significant pulp and paper conglomerate to just a producer of newsprint -- that has to be taken into account. The same can be said for Canadian Pacific; the same can be said for Domtar; the same can be said for MacMillan Bloedel, which, by the way, has just announced in a place that needs jobs, Pembroke, Ontario, a new facility that will employ 120 new employees just in the plant itself. Noranda has downsized as well.

This is downsizing not by cutting jobs but by selling divisions and various pieces of their businesses to other people. So to really have comparative statistics, one has to compare apples to apples and not apples to oranges. I'm just concerned that while there may well be some recessionary effects between 1988 and 1994, I'm not exactly sure that it's as dramatic as these numbers indicate. I think that needs to be brought to your attention.

Mr Buller: I would only refer you to the very, very critical and pessimistic comments in the papers this morning of Premier Harris, who is very distressed by the lack of job creation. I've given this committee a suggestion which I think is worthy of very serious consideration. That is to amend the Employment Standards Act, which should have been done years ago, recognizing that we have massive automation which increases productivity and has a big role in cutting jobs, decreasing jobs. Because if you can produce twice as much with the same workforce, you're not going to need the same workforce. You just have to look at the news this past week about how sales for Christmas shopping are way off. We're in a very depressed economy and they're talking about the economic recovery as a jobless recovery. This is the term we commonly hear.

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Mr Sampson: There's no question about that, and that's why we believe that our focus -- your New Zealand example is very interesting, but you need to carry that forward after those 10 years and indicate what happened in New Zealand now and where New Zealand currently stands. It's certainly better off than what Ontario currently is now. That's why we agree with you that we need to create jobs, definitely create jobs, and that's why we believe that our plan does that. So I just wanted to bring that to your attention, that we have to be careful, again, in comparing statistics such as the ones you brought to our attention.

The Chair: Mr Sampson, you've unfortunately used the government caucus's time. I apologize to Mr Young.

Mr Bruce Crozier (Essex South): Thank you for your submission, Mr Buller. It's truly regrettable that you had so little time to prepare, and we've heard that from many, many of the people and delegations that have come before us. That's part of the problem we have with this process, that you simply don't have time to prepare.

I echo your comments of Mr Harris's yesterday. We have asked for more time. Mr Harris said yesterday, and I'm not sure when to take him at his word and when not to, but in this case I will because he has said that this bill will be passed on January 26, so hopefully some amendments will be made to it that will be helpful.

Mr Buller, in my constituency of Essex South, which is the southwestern part of Essex county 18% of our population is seniors and it's expected to rise to 20% very shortly. I'd like your comments, sir, with respect to the cuts, and I know you've mentioned the tax cut which we feel is driving this, because $5 out of every $8 that are cut are being returned to those who are, we think, better off than most of us in this province.

The effect that user fees will have on seniors, and user fees not only in the area of drug plans but where hospitals will be able to begin to charge for things like meals and doing your laundry and Kleenex, as well as the municipal user fees that will affect seniors on fixed incomes: Could I have your comments, please, on that?

Mr Buller: There's no doubt that it will have a very serious effect. I have here, for instance, a flyer about a rally at Metro Hall in Toronto about the public services which are at risk of elimination, reduction, privatization or subject to increased user fees. This includes community services, child care centres, special welfare assistance, grants to community agencies, homes for the aged -- and I was down at Metro Hall for hearings on that, and if they privatize the homes for the aged, as they're talking about doing, the costs will rise enormously for the elderly who have to use those homes.

There's reference libraries. Wheel-Trans has already been cut for the seniors and disabled. I have the Scarborough Mirror here, in which the Scarborough council is up in arms over the proposed elimination of entire bus routes. In my neighbourhood, Brimley Road, there will be no bus service on weekends. I called my TTC commissioner, who's a Metro councillor, a staunch Conservative, and I said there was no process, that we had no opportunity to make any submissions on this. He just shrugged. He's interested in the Metro Zoo, not in people, just in animals at the zoo.

So we have a tremendous problem there. We could possibly even have garbage collection as a user fee now. It's having a very, very bad effect.

While I'm at it, I might add that the Mirror, which supported the Conservative Party in the last election --

Mr Gerry Phillips (Scarborough-Agincourt): I remember that.

Mr Buller: -- has come out in a lead editorial stating, "We didn't support the concentration of power and erosion of parliamentary democracy as Bill 26 heralds. If that is the cost of deficit reduction and economic prosperity, it's too great a cost. The Harris government must find another route."

This is a paper that supported the Conservatives, urged people to vote for you. They're not happy with what you're doing.

Mr Buller: Everybody is entitled to one mistake, so we'll give that one to the Mirror.

Mr David S. Cooke (Windsor-Riverside): I just want to ask a couple of questions about what you think your perceptions of yourself and your members were during the election, because this bill does a lot of things that we think go directly against commitments that were made in the election.

When Mr Harris made a promise in the last provincial election that there would be no new user fees, especially in the health care system, how do you think your members interpreted that? The way it's now being interpreted by the Premier is that everybody understood that this only applied to services covered by the Canada Health Act and certainly didn't apply to the Ontario drug benefit program. How do you think your members interpreted that promise in the election? Because a lot of your members, I'm sure, voted for the Conservative Party.

Mr Buller: We work with various coalitions and alliances of seniors, and I think probably many of them did expect that they would benefit by having no user fees and having a tax cut. But now the reaction of seniors -- and this I think includes just about all of the major senior citizens' organizations in Ontario, including the Ontario Coalition of Senior Citizens' Organizations, which presented a submission, Canadian Pensioners Concerned, the Older Women's Network. I met with the board of directors of the United Senior Citizens of Ontario, a long-established group of seniors with a couple of hundred thousand members, and they were dismayed with what's happening. They did not in their wildest dreams imagine that this type of an action would be taken by the provincial government. In other words, they feel betrayed.

Mr Cooke: Mr Phillips has been kind enough to offer me his copy of the Common Sense Revolution --

Mr Phillips: I've got lots of them.

Mr Cooke: Yes, I've got mine buried someplace because I think that's about what it's worth. But this document, you will recall, also says under health care: "We will not cut health care spending. As government, we will be aggressive about rooting out waste, abuse, health card fraud and mismanagement and duplication," but there will not be one cent taken out of health care.

Do you think this promise convinced a lot of your members to support the Conservative Party?

Mr Buller: That was probably a factor. I certainly don't think that commitment has been honoured.

Mr Cooke: Oh, I don't either, not when you take $1.3 billion out of the system. We got lectured a lot throughout the election campaign by Mr Harris saying that people were cynical about politics because politicians said one thing during an election and another thing after. I think your brief says very clearly that one of the fundamental things in Canada is our health care system. So when you promise to maintain it, obviously that reassures people and allows them to consider you as a viable party or an option during an election.

There's one thing that I don't think we've talked enough about in this bill. You referred to the block funding to the provinces, and now we're moving to the block funding to the municipalities. Are you concerned that we're not only going to have a checkerboard Canada but that what can happen with this approach in Ontario is that we can have a checkerboard Ontario? Different municipalities will have different abilities to charge different taxes and raise revenues, and there will be different services all over the province because there will be no equity. Do you see that as a real problem?

Mr Buller: I think that is a problem and I think this points up to what's happened. When similar measures were taken in the States, we found that many communities, many municipalities, declared bankruptcy because they weren't getting adequate funding; the funding had been cut back. I can see the same thing happening here. There are communities such as Meaford, Ontario, which returned a Conservative MPP, where half the population are seniors and the other half are on welfare, pretty well. They're going to be very hard hit by cutbacks to municipalities.

Mr Cooke: It would be pretty hard in a community --

The Chair: Mr Buller and Mr Cooke, I apologize. We've come to the end of the half-hour.

I'd like to thank you for taking the time today to appear before the committee.

Could I please have the members from the Association of Municipalities of Ontario come forward.

Mr Cooke: While the next delegation is coming forward, could I make a request for some information?

The Chair: Surely.

Mr Cooke: Based on the articles in the newspaper today on the court decision with regard to the Ontario public service pension plan, I would like to make a request that the ministry provide us with information as to the impact and the implications of the court decision yesterday on the sections of Bill 26 that deal with the public service pension plan, and perhaps some analysis from our research officer.

The Chair: We'll undertake to do that.

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ASSOCIATION OF MUNICIPALITIES OF ONTARIO

The Chair: Welcome, gentlemen, to the standing committee on general government. You have 30 minutes this morning to make your presentation. You can use that time as you see fit. You may choose to leave some time at the end of your presentation for response and questions. I'd appreciate it if you'd read your names into the record for the benefit of the members of the committee and Hansard.

Mr Terry Mundell: I would like to take this opportunity to thank you on behalf of the Association of Municipalities of Ontario for the opportunity to appear before you today to present issues which are critical to municipal governments across Ontario.

My name is Terry Mundell, and I'm a councillor from the county of Wellington and president of AMO. With me today is Michael Power, who is the mayor of the town of Geraldton and the first vice-president of AMO. Our presentation will last probably 15 or 20 minutes and then we will be happy to entertain questions at the end.

We're here today to discuss Bill 26, and I want to focus my comments on schedules M and Q, which will have the most significant impacts on municipalities. It is important, however, that we remember the context in which this legislation was introduced. For municipal governments the context is lost revenue to the tune of $700 million announced in the government's recent fiscal and economic statement.

This substantial loss of revenues did not come as a surprise to municipalities. Although the news of $700 million in reductions over two years was not welcomed, we understand what it means to be responsible fiscal managers and we know that the province is determined to put its own house in order. That's the way municipalities have always managed, without deficits and accountable for how much gets spent and on what.

There is another important consideration of context. Amendments made in Bill 26 need to be durable if we are to look forward to a period of stability in provincial-municipal relations. We need to ensure that the intent of these reforms is very clearly stated for future readers and that the powers set out in Bill 26 are linked to that intent. We believe the intent of the legislation is to enhance the strong and vital role of municipal governments in Ontario.

Municipalities see Bill 26 amendments as a step in the right direction towards a new provincial-municipal relationship in Ontario. Some of what is in Bill 26 is there because we asked for it. AMO certainly has taken the position that municipalities need the tools to manage major funding reductions in a way that minimizes service disruptions and in a way that allows municipal governments to maintain priority services without a major impact on property taxpayers.

There are almost 150 pieces of provincial legislation that have a direct impact on municipal operations. This government has committed to reforming municipal legislation and we are encouraged by that commitment.

In the meantime, the equation is really very simply: Reduced provincial transfers will require reduced services, increased taxes, alternative sources of revenue, or some combination of the three. A reduced provincial share in funding must also mean less say for the province on how programs are managed locally. These factors provide a framework for municipal councils to make informed decisions that reflect local priorities and real, transparent choices for our communities.

No one wants service reductions or increased taxes or user fees, and no one wants to make the kinds of decisions that lead to any of those options. But municipal governments are elected to make those decisions and they are accountable for them.

We have been asking the province for years for the autonomy that goes hand-in-hand with ever-increasing responsibilities. Managing key services in our communities in a way that reflects local priorities, local innovation and local accountability is our business.

As partners in government, municipalities are in the best position to determine the tools we need to manage more effectively and more efficiently. That is why AMO has pressed the province for a number of reforms that will help municipal governments offset lost revenue from the province. A number of measures set out in Bill 26 are critical for municipalities.

Restructuring: Restructuring in the municipal sector will be a major step forward for municipal government in Ontario. The proposed amendments to the Municipal Act point, as they should, to a locally driven process where municipalities come forward with locally endorsed proposals to streamline the organization and operations of municipal government.

That premise is a sound one and one that rejects the adage that one size fits all. The diversity of communities across Ontario calls for locally driven solutions to structural reform. Municipalities are prepared to provide better, more effective and less costly government.

AMO believes that a locally driven process is what the government has in mind with these amendments, and we suggest that the intention be made clear with an addition to section 25.3 indicating that the minister will establish a commission for the development and implementation of a restructuring proposal only at the request of a municipality.

We recognize that not every municipality is willing to embrace change. Some will require support and encouragement or even mediation in order to reconcile differences of opinion and approach. We can live with ministerial prerogative to intervene, but that too should only occur at the request of those involved locally.

Currently, the amendments suggest that the minister will have the power to impose restructuring on municipal governments. We do not believe that is in anyone's best interest, including the citizens most affected.

We recommend very strongly that the wording of section 25.3 be changed to reflect the government's commitment to locally driven and locally initiated restructuring.

The association has one final request on restructuring. Clause 25.3(7)(f) provides for the costs of a commission to be shared by the municipalities and local bodies under review. This provision should be expanded to cover the costs involved with voluntary restructuring exercises.

It is also notable that the restructuring provisions in Bill 26 pertain to county and district governments only. They do not apply to the GTA or to regional governments. AMO will continue to work with the government to insure that the interests of all municipalities, including regions and the GTA, are paramount as the government proceeds with structural reform initiatives.

Migration of services: The migration of services provisions in Bill 26 will assist municipal governments in developing more efficient and streamlined operation of critical services. It is vitally important that municipalities, not Queen's Park, determine which level of municipal government is most suited to provide a service.

However, translating these provisions into cost savings will take time. The transfer of services are quite typical of the steps we need to get on with managing our business as we see fit. They will help us offset some part of lost provincial revenues. But it will take time and these provisions alone cannot compensate fully for such a substantial loss of revenues.

We would ask for clarification on certain sections of these provisions. For example, we need to clarify exactly what services are transferable and to whom. Subsection 209.4(1) sets out provisions for the assumptions of upper-tier powers. Does it mean, as the wording suggests, that a lower-tier government would have to assume responsibility for particular services across the whole upper-tier catchment? Would a local municipality assuming responsibility for roads from the upper tier be required to maintain roads for all of the local municipalities? We don't think that's the intention.

Section 209.4 should be revised to indicate clearly the requirements governing the transfer of services from one tier to another.

Clauses 1(a) through (h) of section 209.4 also present a problem for us in that they provide unnecessary regulatory authority to the province. In our view, there is no reason for the province to decide which services can and cannot be transferred from one tier to another.

Special purpose bodies: The capacity to dissolve special purpose bodies is a very important part of this bill. Special purpose bodies have the authority to make decisions that have significant impacts on municipal resources. However, they lack the public accountability that must be integral to that authority. It is high time municipalities had the power to dissolve special-purpose bodies in favour of direct accountability for decisions governing public funds and services.

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It really is a question of accountability. How tax dollars are spent, by whom and for what, should be clearly and easily understood by residents of Ontario. It is also a question of sound financial management and planning. Municipalities are too often in a position of having the rules changed halfway through the game. A different fiscal year from the province and factors like in-year savings targets make planning on the revenue side difficult enough.

We need to be able to plan for the expenditure side with certainty that comes with real authority over how we spend our own resources. Municipal councils, and not special-purpose bodies, must have the authority and accountability for how our municipal government spends taxpayers' dollars.

At this time, powers of dissolution in Bill 26 do not include police services boards or school boards. AMO has made its position on special-purpose bodies well known to the minister and we are encouraged that the government will be reviewing the role of police services boards in the context of a broader review of the Police Services Act. AMO will continue to press the government for maximum flexibility to manage services funded through the property tax base.

We understand that the government is considering regulations that will protect certain special-purpose bodies. The purpose of this legislation is to provide greater autonomy to municipal governments, not less. Regulations restricting our capacity to manage will counter that intention. The example of library boards is a good one. An exemption of library boards would be totally unacceptable and would seriously undermine the intent of this bill.

AMO urges the committee to consider the potential impact of regulations made under section 210.4 and to recommend that exemptions be granted in exceptional circumstances only, and not categorically for any type of organization.

User fees and licensing: Bill 26 sets out fairly broad provisions for user fees and for licensing. AMO supports these provisions because they provide a potential alternative revenue source that is based on usage of services and, in some cases, linked to consumer choice. The scope of authority to levy user fees has been the subject of concern in some quarters. We do not share those concerns.

The ability to charge user fees and to collect licensing fees that at least offset the cost of providing the licence is not seen by municipalities as a major potential inflow of revenue. These provisions will help us manage in the face of substantial and dramatic reductions in funding from the province. If we are to continue to meet provincial service priorities and local service priorities, we need to be able to pay our bills.

Municipal governments have a strong vested interest in minimizing user fees to taxpayers, just as we have an interest in keeping a lid on tax increases. Electors will have short tolerance and long memories for municipal governments that use powers irresponsibly.

Ontario municipal support grants: The issue of responsible management leads us to the Ontario Municipal Support Grants Act. Autonomy for expenditure funded under the act is substantial. We believe that is the intent of the legislation. Block funding by definition should come with no strings attached.

Section 3 of the act provides for regulations that can be used to create strings. We recognize that the province has a responsibility to set and monitor provincial standards and to monitor the performance of its transfer payment partners. It is my understanding that the minister intends to set standards based on clearly articulated provincial priorities, and to develop performance indicators in consultation with AMO and other key municipal parties. We believe our input is essential, but we have some concerns over the potential for excessive regulation over the longer term.

As more municipal funding is collapsed into municipal support grants in the future, there may be an inclination to restrict local decisions on how this money is spent. That would contravene the intent of the legislation as we understand it.

We would ask the committee to recommend that the Ontario municipal support grants legislation clearly establish the autonomy of municipalities to manage funding in a manner that is consistent with local needs and priorities, mindful of clearly defined provincial interests.

Conservation authorities: AMO is concerned by proposed amendments to the Conservation Authorities Act that restore greater decision-making authority to municipal councils. We are also in favour of new provisions which limit the levying of costs against municipalities. We would suggest, however, that resolving disputes over charges made by conservation authorities would be greatly simplified if municipalities had the authority to approve the charges levied in the first place. For example, appealing decisions to MNR's mining and land commissioners, decisions that may have a direct impact on property taxes, does not make any sense and is not acceptable to municipalities. We recommend that the appeal mechanism in section 27 be dropped in favour of direct municipal authority over charges made by conservation authorities.

Schedule Q: Schedule Q of Bill 26 sets out amendments to the Fire Departments Arbitration Act, the Police Services Act and the Hospital Labour Disputes Act with respect to arbitration. Most importantly, the amendments require arbitrators to consider a municipality's ability to pay. We have requested an additional amendment that requires consideration of the ability to pay without additional costs to the property taxpayers. AMO has also requested that an amendment respecting wage comparisons be expanded to include comparisons to similar jobs in the private sector, rather than in the broader public sector alone. We have also asked that the employer's ability to attract and retain qualified employees replace the reference to an employer's need for qualified employees.

Interest arbitration issues have been long-standing between the province and municipal governments, and AMO has worked very hard to keep these issues on the provincial-municipal agenda. As employers, municipalities need permanent savings in place to compensate for the more than $390 million cut from municipal transfers as a result of the social contract and the expenditure control plan. We need assurances that compensation issues can be negotiated or at least resolved openly and fairly and with due consideration of the fiscal pressures facing municipal governments. Compensation awards through arbitration that give no consideration to our ability to pay are no longer acceptable.

AMO urges the committee to recommend that the ability-to-pay provisions under schedule Q be revised to indicate that property taxes will not be raised as a result of arbitration awards; that the private sector comparisons are appropriate; that management retains the right to attract and retain qualified employees as it sees fit; that negotiated wage settlements in a municipality provide a ceiling for future awards; and that cabinet retains the right to alter and prescribe criteria for consideration and the issues which may or may not be sent to arbitration.

What's missing from Bill 26? AMO's comments have focused on schedules M and Q. However, we would like to address a number of important issues which we believe are missing from Bill 26. They are important provisions that were requested by AMO but have not been included in this bill. If the intent of this legislation is to assist municipalities to manage with new, smaller allocations, we need to account for the gap between what municipalities need and what we'll be given in this bill.

They include greater control over police budgets and an end to supplementary assessment charges. AMO has also requested that the province extend to municipalities what it has provided to itself for the management of its own operations: the removal of successor rights from legislation governing the contracting-out or divestment of services. The authority of municipalities and other bodies such as school boards to jointly invest resources has also been raised with the minister.

We could go on to discuss other critical issues such as the importance of development charges for growing communities, but instead we will close with an appeal to the committee to consider again the primary reason the Bill 26 amendments are before us today. That reason is to ensure that municipalities, as partners in government, have the tools we need to manage in the face of substantial funding cuts. Bill 26 will not alleviate the impacts of $700 million in lost revenues, but on balance the amendments are a good starting point and we can put them to work in communities across Ontario. They need to be considered, however, for what they are: a critical and long-term investment in a renewed provincial-municipal relationship in Ontario.

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AMO will continue to press the government for other important reforms and we will work together with the government as we forge a vital and renewed role for municipal governments in Ontario.

There is a summary for the committee of the proposed amendments in appendix A which follows this document.

I would like to take the opportunity to thank the committee on behalf of AMO for the opportunity to appear here today and look forward to answering any questions you may have.

The Chair: Thank you very much. We've got three minutes and 20 seconds per caucus. We'll start off with the opposition caucus, Mr Phillips.

Mr Phillips: I just start by saying, I hope AMO appreciates how totally outrageous this process is. We have two minutes and 20 seconds to have a chance to ask you questions on an act that has absolutely fundamental importance to every municipality in this province -- two minutes and 20 seconds. This would have been law at 6 o'clock tonight.

The Chair: Three minutes and 20 seconds.

Mr Phillips: Well, three minutes and 20 seconds. My apologies. Sixty more seconds to dialogue with what we regard as an extremely important group in this province, the Association of Municipalities of Ontario.

By your own definition, this act fundamentally changes municipalities, but it is but one of 14 acts. If you look at the people who are presenting to this committee over the day, the prospectors will be in. The seniors will be in. We're dealing with a huge act and in three minutes and 20 seconds they expect us to give you a decent hearing. We find it outrageous, frankly. I don't know whether you find it as outrageous as we do. Your proposal outlines 11 major amendments that you want made to this bill. This bill would have been law at 6 o'clock tonight, and I find it offensive that the government thinks that they can deal with municipalities in a high-handed fashion like this.

Frankly, we should have separated the municipal portion of this bill, AMO should have had decent time to allow us to discuss your proposals with us and we should have had a fair and an equitable hearing. And my apologies to AMO for this tirade because you have nothing to do with it other than being forced to appear here, being given three minutes and 20 seconds to discuss your lives with this committee. I find it outrageous, and to allow AMO, as I say, so little time, frankly I will take the opportunity to discuss this with you in more detail because your amendments are fundamental, but we can't do it justice in three minutes and 20 seconds with 11 major amendments to this bill and put in a context of 14 other huge sections. I think you're being insulted by the government frankly.

The Chair: You have about 45 seconds.

Mr Phillips: Forty-five more seconds.

The Chair: Do you want to comment?

Mr Phillips: I don't know whether you're as embarrassed as you should be, but to treat AMO in this fashion -- they've come here with a significant brief and virtually no time to discuss it. As they say, it's fundamental to their future.

I would have thought that we would have had the Municipal Act before us and if we're going to open it up for these major changes, you would have had an opportunity for a reasoned discussion. Frankly, Mr Chairman, I think that what's required is for our caucus to meet with AMO and have an opportunity for them to have a full dialogue with us so we can at least get their concerns a fair hearing.

The Chair: Thank you. Mr Cooke.

Mr Cooke: Mr Chair, I would also like --

Mr Michael Power: May I reply to that, Mr Chairman?

Mr Cooke: Well, not during my time.

Mr Power: All right.

Mr Mundell: We'll feed it into your time.

Mr Cooke: I certainly agree with Mr Phillips's comments and we will need to spend some more time with AMO in our caucus going through some of your brief.

I did find it curious though, Terry, that your initial comments about the bill and your ending comments about the bill are praising the bill and then everything in between is talking about some very significant criticism of the bill. I kind of wonder where AMO's coming from. When you get down to the nitty-gritty and the specifics of the bill you have great concerns. You didn't talk about taxes. I'm sure that there are others who will want to talk to you about taxes and some of your members have come forward and told us what their legal interpretations are of the ability to bring in gas tax, sales tax and income tax because it goes much further than the kinds of user fees that you're referring to in your brief.

But I'd like to just talk for a couple of minutes on the restructuring aspects of the bill because I'm not exactly sure that I understand AMO's position. You're suggesting a couple of amendments to Bill 26 which would, in effect -- and I may agree with the amendments you're suggesting -- amend the bill back to the way that it is under the current law. Under the current law, if you want to restructure you can do that and it can be driven at the local level. It doesn't have to have a commission set up by the government. In fact, you could set up in a county your own commission to look at restructuring, and there were restructuring studies from one end of this province to the other end of the province, most of which were not implemented even though the restructuring committees came to some of their own local consensus. There was never the ability to drive that restructuring through the system. So I gather from your brief what you're suggesting is that we should amend Bill 26 back to the current process that's in place now.

The other part that I would really like to get your impressions on: You specifically refer to the cost of a commission being borne by the municipalities. Well, that's interesting and that's important, but what about the cost of the transition period when there is restructuring that's taking place at the county level or the local level? There are usually millions of dollars of transition costs in order to make sure there's not any huge immediate tax impact, and there's nothing in this bill and there's nothing in the government's statement; in fact, any comments in the government's statement would make it very clear that if there are any tax impacts, any transition costs, they are going to be borne at the local level. So if there are no provincial dollars to pay for transition costs and facilitate restructuring, then why would there be any restructuring at the local level? Because the cost to the local taxpayer would be huge.

Mr Mundell: On the first issue, on the restructuring itself, I think the premise that AMO has put forward and has always maintained is that that particular process should in fact be locally initiated and locally driven.

Mr Cooke: That's the way it is now.

Mr Mundell: With local decisions. There are some impediments in the current legislation which make restructuring more difficult, and there are some items in Bill 26 which in fact help to streamline the process. I think those are the things that we see as positive under the restructuring portion.

As far as allocations for cost of transition periods, I would say to you that there are going to be some very difficult decisions across municipal governments in Ontario to determine the types and levels of services and what each municipality is going to need to provide, and transitional issues will become of major importance and they will vary across the province from municipality to municipality or restructuring to restructuring. I think those things will need to be determined on an individual basis.

The Chair: Thank you. We must move now to Mr Hardeman.

Mr Ernie Hardeman (Oxford): Good morning, Mr Mundell. First of all, I'd just inquire for the record, how many municipalities does AMO represent and could we consider this morning's presentation as reflective of the position of those member municipalities?

Mr Mundell: We represent approximately 700 out of Ontario's 815 municipalities, approximately 95% of the province's population.

Mr Hardeman: The other issue about consultation, and in fact in your opinion or in the presentation -- is there much in this Bill 26 in the M section in particular that in fact AMO has not over the last number of years, and particularly in the last few months, had considerable consultation about? Are there any major items in that -- not necessarily saying that the bill does what AMO put forward, but items that you have not discussed and had consultation on in the past?

Mr Power: Well, that's interesting, Mr Hardeman. It's similar to the question that Mr Phillips asked and it's interesting in the sense that AMO throughout the previous three governments, a Conservative government, a Liberal government, an NDP government, and now another Conservative government -- many of the things that are in that bill are things we've discussed with each one of those governments on various occasions; we have brought them forward, we have asked for them. So for us it wasn't a matter that we didn't have time to consult with the individual parties that are represented in the Legislature. We had consulted with them all as governments.

There are things that are happening through this bill that we're very pleased about, and I think we made that very plain here today when the president said that many of the issues in this bill are things that AMO had asked for. So in our view there has been consultation, certainly, with our association by a wide variety, and the support from our members is very strong. That has come up through our municipal association at its annual meeting over the last numbers of years, and that support for these kinds of things is there.

There has been a suggestion perhaps that taxation is an issue here. We put it to you that we don't think it is. Certainly we have no legal opinion that says it is any different than what the minister has said the intent of this bill is.

Mr Cooke: Do you have a legal opinion?

Mr Power: We don't have any legal opinion that says it's any different than what the minister says it is.

The Chair: That about exhausts the time. I'd like to thank you, gentlemen, for appearing today before the committee.

Could we have representatives from the Oakville Chamber of Commerce come forward, please.

Mr Phillips: Mr Chair, I wonder if AMO might provide us with their legal opinion, if they might table that with us?

Mr Power: Mr Chairman, I said we didn't have any legal opinion that contradicted in any way what the minister had said. We don't have a legal opinion. We don't think we need one.

Mr Phillips: Oh, okay. I appreciate that. Thank you.

The Chair: Could I please have any member from the Oakville Chamber of Commerce come forward? Not seeing anyone here right now from the chamber, I'd like to call a five-minute recess and give them some time to be here.

The subcommittee recessed from 1032 to 1039.

OAKVILLE CHAMBER OF COMMERCE

The Chair: That's the end of the recess. Welcome, gentlemen, from the Oakville Chamber of Commerce. You'll have 22 minutes today to make your presentation. You can use that time as you see fit. You may wish to leave some time at the end of your presentation for questions. I'd appreciate it if you'd read your names into Hansard for the benefit of Hansard and the committee members.

Mr Peter Warmels: My name is Peter Warmels. I'm president of the Oakville Chamber of Commerce. I have with me today Mr Don Crossley, who is our executive vice-president, and Mr Andres Paara, who is our vice-president as well.

The Oakville Chamber of Commerce is a business-affiliated firm that represents 1,100 members within the town of Oakville. Eighty per cent of the businesses that we represent have fewer than 20 employees, so it's from that format that I'm speaking today.

The omnibus bill is one that we feel has a number of good points and a number of points that we feel we need some further clarification on and further consultation on. But I think for the benefit of the bill in general, we feel that it clearly defines the new freedom that the municipalities are being given to generate revenue and to operate autonomously. Empowerment is a method of management not new to the business community, and I think that's what you're giving the municipalities.

The tax burden must be reduced, and all levels of government have a responsiblity to make this happen. Our membership want less government, more cost-effective government and more efficient government. We simply cannot afford to do the things that we used to do some time ago.

Municipalities across Ontario will be released from many of the rules that have constrained their decision-making, thus allowing communities to make choices based on the needs of their community. It will allow municipalities to deliver services efficiently by entering into partnerships with the private sector. It will help get rid of waste and duplication by allowing municipalities to decide which levels of municipal government should deliver the services. These measures will lead to greater accountability at a local level for local taxpayers, will provide funds necessary to be spent, and in the end will provide us with a more self-reliant and cost-effective local government.

It is our understanding that in Bill 26 the Minister of Health has the power to close and merge any community hospital and terminate specific health care services provided by a hospital. In addition, he or his agent may inspect, copy and disclose the medical records of any citizen of Ontario. Is this correct? If so, these changes are very sweeping and certainly should be carefully considered and phased in in perhaps a longer period of time than is being presented in the omnibus bill.

The user fees provision, while certainly having merit, must also be carefully considered. We have read reports in the press about how several mayors in the Toronto area are anxiously awaiting approval of Bill 26 so as to allow them to start slapping user fees on everything from firefighting and police services to libraries and city parks. This could wind up being simply another form of taxation and could cause people to think twice about using a service, based solely on their ability to pay. Will this lead to a two-tiered system of services in all areas -- not just health care -- for those who can afford and those who cannot? We recognize some abuse in all areas of public service today, but we'd like you to consider the need to provide some further consultation to some of these areas.

I had a chance last night on my way home to talk to some chamber members, and the message rang out very clear to me that some of the moves in Bill 26 are in need of much more consultation.

The proposed shift in drug benefits will shift the balance at the retail level without helping the public sector with a reduction in government cost or service. The deregulation of prices in prescription drugs will result in reduced margins as it becomes used as a loss-leader. This will kill the local pharmacies at the corner that people use on a regular basis to seek out convenience and quick service for their health needs. They've already been hurt by the changes in the sale of cigarettes, and this will only drive another nail in the coffin of their businesses. The concern that we have is, will those businesses be around tomorrow? Do we want drugs to be subsidized by other products? User fees for services such as the $2 hit for seniors will become a retail carrot used to attract seniors by waiving that cost. The total market will cover the cost, to the detriment of their businesses.

Part of the chamber's network is also to provide input to the local school boards. Without going into any detail, the underlying concern from them as well is, are we properly prepared to take the huge step that Bill 26 is taking? As we've pointed out, in some areas yes, but in a number of areas we require more sensitivity. Some would even say that the approach is somewhat draconian. More consultative: Get more effective decisions, only because of the far-reaching implications. It's no different really from what you've done today in providing us with the opportunity to speak to the omnibus bill that we would look to you to provide us with in future in having more consultation.

It's moving too quickly. I think there's certainly a need for it, but there's a lot in the bill that you're presenting on the table today. It would certainly be appropriate to perhaps separate the bill, with some careful consideration to all aspects for the benefit of those who have invested in Ontario today and who are looking to invest in Ontario tomorrow.

The Chair: Thank you. You've left about 14 minutes. We're starting off with the third party. Oh, in their absence, we have to move to the government party.

Mr Terence H. Young (Halton Centre): Thank you very much for an excellent presentation. Thanks for coming out today. With regard to the reference to direct taxes, if the bill were clarified or it had changes to it which made it clear that the municipalities could not levy a poll tax and could not levy a gas tax, would that address those concerns?

Mr Warmels: What we need to consider is that there are certain people who are much more expert at this than some of us sitting here today in particular areas of the bill. I would simply encourage you to look to those experts who know those particular aspects of the business that you're bringing to the table in Bill 26 and seek some direction and some support from them in understanding perhaps a little bit more pointedly what it does and what the implications of it are.

Mr Young: I agree. We have done that and we are doing it and we'll continue to do it.

The gentleman from AMO, Mr Mundell, said, and I'll quote out of their presentation: "Electors will have short tolerance and long memories for municipal governments that use these powers irresponsibly." Hazel McCallion, I'm sure, would agree with that, and so would Don Cousens, from their presentations. What's your comment on that?

Mr Warmels: Certainly I think there are a number of municipalities that are prepared today to go ahead with Bill 26 the way it's been presented. However, I'm somewhat concerned that not all municipalities are prepared to service Bill 26 in the way that it's being tabled today. It would lead to some anarchy, in those municipalities that aren't prepared, in how to deal with them effectively.

Mr Hardeman: Going on with the same issue of the taxation powers, you mentioned the concern about user fees. Do you envision the municipalities using user fees to increase revenue and increase expenditures beyond what they're presently providing, or as a way to provide their present services? Is your concern that they would use it as a tax grab, as opposed to trying to provide for those core services that are presently being provided?

Mr Warmels: I think the municipalities recognize the need to support the constituents that they are being represented by, and I think, as a consequence, whoever has the opportunity to provide the greatest direction for them will certainly benefit them. I think that if the municipalities are continually going to have support taken away by the provincial government and they are required to meet a balanced budget, they will be forced to do whatever they're required to do. If that means in their eyes that they're going to be forced to put additional taxes on the services they provide, then that's what they'll have to do. I'm certainly not saying today that's the right direction to go, but we agree that a balanced budget is something we all look forward to so that we can minimize the deficit that we carry with us.

Mr Hardeman: I was just wondering whether you feel that local government is, as was mentioned in AMO's presentation, more responsive to the electorate, that in fact their ability to decide between taxation and the service being provided is going to be more responsive to the people than it would be from money being collected by the province and sent to municipalities.

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Mr Warmels: We certainly hope it will be.

Mr Crozier: Thank you for your presentation. Could I ask you when you were notified that you would be appearing before the committee?

Mr Warmels: Yesterday morning.

Mr Crozier: You've done remarkably well in the short period of time that you had. I don't want to put any words in your mouth, so I'll ask you a question that you can respond to. From what you've said, would you consider this then to be a very complex, wide-ranging, wide-sweeping bill that is difficult, if in fact you've had the opportunity to go through it clause by clause, to understand and respond to in a short period of time?

Mr Warmels: We've had the bill for a short period of time and had the opportunity to synopsize what's there, but I would agree that it's an extremely complex bill and, while it does provide some benefit and some good things that are going to be necessary in reducing our government spending, there is a lot of detail in there that I believe is being pushed through to satisfy all of the needs that the government is presently doing.

I would caution you that this move may not be in the best long-term interests of the public. That's why I've mentioned many times in my report to you this morning that we would simply recommend some further consultative processes take place with those specific business sectors that are being affected by this, so that those that already have a vested interest in Ontario will continue to do so.

Mr Crozier: Sir, in response to a question the other day -- and I'm reading from Hansard -- about direct taxes and gasoline taxes, Mayor McCallion said, "I guess even a gasoline tax" could be applied. "I can tell you, when we discussed integrated transit in the greater Toronto area, the only way that we can have integrated transit" is that all municipalities are involved with a gasoline tax. "We would have to ask the government to pass that. Maybe now we might have the opportunity to put it in, yes."

When it comes to direct taxes, fees and charges that are in the nature of a direct tax for the purpose of raising revenue, I wonder if you're aware that the councils do not have to get the approval of the electorate, they only have to pass a bylaw, and that the decision to apply these taxes is not appealable to the Ontario Municipal Board. Were you aware of that?

Mr Warmels: As I said earlier, I'm not aware of the specifics pertinent to every aspect of the bill. We've received a synopsis from one of our chamber members who has gone through the bill with some degree of detail.

To your point, I think it's important that municipalities be provided with a certain degree of flexibility to manage their affairs. However, we continue to have concern over the fact that the municipalities today have much less provincial support and are being pressured to maintain a balanced budget, no different than the federal and the provincial governments are, and that they will need to do whatever they will in order to maintain that balanced budget.

I think certainly they're much closer to the taxpayer, and if there's going to be some public outcry over certain user fees, be they gas taxes or be they whatever, that's something the municipality will have to deal with on a one-to-one basis.

Mr Crozier: Certainly municipalities have had to balance their budgets by law, and I think they've done an outstanding job. I merely wanted to point out that if they do apply these taxes, unlike at the present time, there is really no process by which you, as a business owner or operator or taxpayer and the general public, with this bill, could appeal it.

Now the minister, on the other hand, has almost the absolute authority to imply certain regulations, or restrictions through regulation, and the minister in fact can withdraw funding from a municipality if that municipality doesn't behave fiscally the way the minister thinks it should. We feel that's too much power. It's giving the municipalities the power on the one hand, unappealable by you, but then on the other hand the minister can certainly take that rope and tighten it around the municipality's neck. It's kind of giving and taking away at the same time.

Thank you very much for your presentation.

The Chair: Thank you, Mr Crozier, and thank you, gentlemen, for coming forward today to make your presentation.

The Ontario Restaurant Association has cancelled at 11 o'clock. The clerk is going to look for the 11:30 presenter. If Mr Tabuns is available, we'll see if he can speak now and then we'll add that half-hour to the lunch break. Perhaps we could just hold on for a minute or two here.

Mr Cooke: I'm sure the Ontario Restaurant Association isn't here because they've come to the conclusion they couldn't possibly support this legislation.

Mr Crozier: Paul Oliver was here yesterday. He was here a good part of yesterday. That's unusual for him.

The Chair: We'll recess until 11:30 then, when Mr Tabuns is scheduled.

The subcommittee recessed from 1057 to 1127.

PETER TABUNS

The Chair: Can I please have Councillor Peter Tabuns come forward. Good morning and welcome to the standing committee on general government. You'll have a half-hour today to do your presentation. You can use that time as you see fit; you may want to leave some time for questions and responses. I'd appreciate if you'd read your name into the record rather than I, so that the members of the committee and Hansard can get it.

Mr Peter Tabuns: I thank you for this opportunity to speak today. I won't need the whole half-hour, although if you have questions, that might fill up the time slot.

As you've said, my name is Peter Tabuns. I'm the city councillor for ward 8 in the city of Toronto. I'd like to thank you for this opportunity to address you on the matter of Bill 26.

As my colleague Councillor Kyle Rae said when he addressed you the other day, my comments are not going to be complete. That in fact is my first point: The scope of this bill is so vast that it's difficult for any one individual to completely grasp its contents, to analyse its impact and to present a comprehensive critique. This problem is compounded by the short time frame which the public and the opposition have to assess it and make comment.

To start with, then, I think the manner in which these broad changes are being introduced is fundamentally flawed. I think that this bill, in its present form, should be withdrawn and broken up into several bills. That would give the public a better chance to address the issues in an informed and precise way.

Secondly, there must be a greater opportunity for people to address the legislators about this bill. I understand there was a vote yesterday to not extend the hearings. I'd ask you to reconsider that. The hearings this week weren't announced in the newspapers, which would have given people a chance to register to speak. Many found out about the hearings too late. I think that it would be worth while for you to schedule another round of hearings on the bill in Toronto in February, to give the public a chance to speak and make you as legislators aware of issues that may not have been on the minds of the drafters of this bill.

I'm very concerned that the process embarked upon with introduction of this bill will bring discredit to this government and to the provincial Legislature. People are aware of the bill; frankly, to my mind, the depth of awareness is quite surprising. They don't know all the details, but they do know that the bill is quite far-reaching and, to the eyes of many in the public, they see this bill as being rammed through. I don't think it does credit to our democracy. It doesn't strengthen the legitimacy of our governments. I think this process, this approach to legislative change should be abandoned.

Earlier this week, in a front-page article, the Globe and Mail headlined, "Ontario Starts Scrutiny of Power Shift." The Globe, not known for its socialist leanings, reported that this bill will concentrate power "as almost never before in the hands of the 18 men and women who sit around the cabinet table." I don't know if cabinet ministers are present, but those who are in cabinet may feel that this is not an unreasonable turn of events. They may feel that power will be used judiciously and in the best interests of the people of the province, but I caution members of the government that no government is in power forever. In fact, these days most governments have difficulty lasting into a second term.

Would members of the government be comfortable with this concentration of power resting in the hands of a cabinet of adversaries? Would the government members feel that such unconstrained concentration of power was good for the society in the hands of a party that they may have a very different perspective from? I don't think most government members would. Certainly those of us not in the provincial government are not happy with such prospects.

In particular the changes to the Municipal Act, for instance, in the view of a number of us at the city of Toronto, virtually make the Minister of Municipal Affairs the de facto mayor of the province. For a government elected on a promise of getting government off the backs of the people, this package is quite contrary to what we see as your stated aims. We see power concentrated in fewer hands than ever before, concentrated in a way that insulates decisions about its use from the Legislature and from the municipal electorates who thought they actually elected local councils that had some real power on a local level.

Previously I noted that this legislation should be abandoned in its current form because of the process being used for its introduction. I believe it should also be abandoned because the centralization of power is counter to the accountability and openness that we expect from our parliamentary governments in this country. As for the substance of the bill, I want to touch on just a few issues.

With regard to section 220.1 of the Municipal Act, it is the opinion of the city solicitor that the ability to charge direct taxes would allow the city to charge income taxes or municipal sales taxes. I believe the city solicitor filed a document with you earlier this week setting out his opinion in that matter.

More importantly, to my mind, it would allow municipalities to charge poll taxes. At a minimum, I would ask that you delete this section and prohibit the levying of a poll tax explicitly. Such a tax is extremely regressive and, as Margaret Thatcher found out, likely to lead to social upheaval. The minister has made it very clear that he contemplates no use of the legislation to impose poll taxes, and therefore I would see no problem for this government in changing the legislation, making it explicit that a poll tax is a prohibited change or decision on the part of municipalities.

My understanding is that the whole section is supposed to allow municipalities to charge user fees as a way of making up for provincial cuts to municipal transfer payments. I don't think it can be any plainer that this is a mechanism for a simple download to municipalities, a way of transferring responsibility for unpleasant decisions about cuts to lower levels of government. It's a download that will mean the imperfect financing of government operations by income tax will become an even more imperfect method of charging poor and working people for services. It's a shift of payment burden from the wealthy to the rest of the population, and I think that's fundamentally wrong.

Section 67 of the proposed legislation, adding clause 116(1)(b) to the Public Transportation and Highway Improvement Act, should be amended to disallow privatization of public transit. Public transit is fundamentally necessary to the healthy functioning of modern cities. Decisions about routes, service levels and fares should be made by the democratically elected representatives of the people. Private sector operators must, of necessity, base all decisions on the bottom line. I think that's entirely reasonable on their part, but then why would these operators be concerned about unprofitable lines serving low-income neighbourhoods? Where would be the assurance that service levels would reflect the needs of the population rather than the profit calculations of the private operator? Do we want cities where whole areas could be written off by transit operators? I think, frankly, that would be disastrous, and this bill should make it clear that it won't be allowed to happen.

In a similar vein, section 33 of schedule M, which expedites the privatization of municipal utilities, should be stricken from the bill. Once privatized, it would be virtually impossible for the public to reclaim these utilities. At a minimum, the public must retain the right to speak on these matters through a referendum.

I haven't touched on all the elements that concern me in this bill, nor has the city council to which I belong. As chair of the board of health for the city of Toronto, I have grave concerns about the changes to the drug benefit plans and I echo the sentiments of my council in asking that you abandon changes that are proposed. I know this particular committee is not dealing with the health sections of the legislation.

This government is putting forward an agenda I disagree with, and that's its right, but I don't believe that it should be putting it forward in a bill that I think makes a mockery of public consultation. I have surprised myself -- my comments were even shorter than I thought.

The Chair: Thank you. We've got about seven minutes per caucus. We'll start off with the government caucus.

Mr Hardeman: First of all, I think you mentioned the issue of the opinion of the city solicitor recognizing that you could charge income tax and poll tax?

Mr Tabuns: Yes.

Mr Hardeman: And sales tax?

Mr Tabuns: Yes.

Mr Hardeman: I understood that in fact he was not indicating that sales tax could be charged, or gasoline tax. Could you clarify that for me? Did he indicate that you could charge sales tax and gasoline taxes?

Mr Tabuns: If you'll wait one second, I'm digging out his section on that.

Mr Hardeman: It's not critical; we can find that later. I believe it was mentioned previously in our hearings that the legal opinion from the city solicitor indicating that would be provided.

Mr Tabuns: In fact, I did find the section. It's the document that was submitted, I believe, on Tuesday, the city of Toronto submission to the standing committee, tab 4, page 4. The solicitor notes: "The proposed legislation specifically states that such fees and charges `are in the nature of a direct tax for the purpose of raising revenue.' This provision significantly broadens the city's ability to charge user fees and no longer ties such fees to recovering the cost of providing services. A `direct tax' could include a flat-rate head or poll tax or an income tax, or possibly even a municipal sales tax."

Mr Hardeman: It doesn't mention the gasoline tax. I think there's been considerable discussion about that.

Mr Tabuns: No, he doesn't. That's correct, and I don't believe I mentioned that one.

Mr Hardeman: Another point, if I could: You mention the issue of public transit and the ability to regulate. Do you see the inability of municipalities to regulate public transit in a contract to provide a certain level of service, a certain type of service from a private contractor? Is that not a possibility? Do you see anything in the act that would prevent that from happening?

Mr Tabuns: First of all, I haven't read that section in detail. I'm relying on the précised notes that were provided by our solicitor, so I can't say whether it's prohibited or allowed, what the status of the act is.

My experience in government is that people who have contracts with those governments can have significant political power and can apply pressure to elected representatives to vary contracts in ways that are quite legal but are certainly beneficial to those who hold the contract. Although at one point in the life of a contract you may have full protection for a city, I can't see why one should rule out the possibility that at a later point an operator would say: "Look, I'm losing money on these lines. Either you cough up or I'm going to cut them off." In an environment of a cash-strapped municipality, you may in fact find that the municipality won't pay, that it will allow an operator to cut a line.

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Mr Hardeman: If I could, one further on the user fees and on the taxation: If the bill included an amendment to strictly prohibit the type of taxes you refer to, the poll taxes and the income tax, would you be supportive of the municipalities' ability to charge user fees as they see appropriate for the service that they're providing?

Mr Tabuns: I actually have difficulty with most of the user fees. I think there are different philosophies around taxation and that in general those with lower incomes should not be paying as much as those with higher incomes, and the user fee is a pretty blunt instrument. When someone comes in to use a swimming pool, one doesn't ask what their income is; one just charges them a flat rate.

It makes more sense to me to raise revenues for governments through income taxes predominantly, and to provide services to people as necessary without adding on that service charge. I think the service charge moves the revenue collection down the population to people of lower income. I think it's a regressive tax, and that's the problem I would have with it.

Mr Hardeman: So your suggestion would be that municipalities should be raising property taxes as opposed to user fees?

Mr Tabuns: Actually, that has been my position at city council and those are motions that I've put forward.

Mr Sampson: Councillor, you have considerable experience in local politics. I'm wondering whether you can tell the committee, in your view, whether it's the local level of politics that's better in touch, if I could use that phrase, with the needs and requirements of the community as opposed to perhaps any more -- and I'll use the word, and don't take it the wrong way -- senior or farther-away-type level of government.

Mr Tabuns: I haven't sat at any other level of government and I think it might be presumptuous of me to say that I have a better view of what's going on than people at the provincial or federal level. It may depend, government by government and representative by representative. I'm sorry, I don't think there's an absolute answer to that question.

Mr Sampson: So you're not able to tell me whether or not it's better for the local government to be delivering services as opposed to a provincial-type government. Do you have any views on that?

Mr Tabuns: I think it depends on the service. There are some services that are more sensibly delivered on a province-wide basis and some that are more sensibly delivered on a local basis. I don't think there's a one-size-fits-all approach to which level of government is best for delivering particular kinds of services.

The Chair: Let's move now to the opposition side.

Mr Phillips: I appreciate your brief as well. I just wanted to talk a little bit about the tax area because that's been an area of some considerable interest.

The minister, Mr Leach, has said he is absolutely convinced that the way the bill is written right now prohibits sales tax or income tax. In fact, he's so convinced that if he's wrong, he wants to quit. He sort of said, "Listen, I'll be embarrassed enough that if I'm wrong, I'm going to quit," which is quite a strong statement. I was surprised he said that, but that's his decision. Therefore I assume it is the government's intent that the bill prohibit municipalities from introducing a sales tax or a gas tax.

We've now had I guess three legal opinions on this. The city of Mississauga and the city of Toronto have both told us that their legal interpretation is that it "permits" a sales tax, but the minister has said, "No, it prohibits a sales tax." In fact he feels, as he says, so strongly about it that if he's wrong, he's going to resign.

Did your solicitor review this thoroughly, and have they given you a written opinion that would suggest this does permit the introduction of a head tax or a sales tax?

Mr Tabuns: That's the document that was submitted by Councillor Kyle Rae when was here on Tuesday morning. If you pick up the document, on tab 4, page 4 the solicitor says, "A `direct tax'" -- which is referred to in the legislation -- "could include a flat-rate head or poll tax or an income tax, or possibly even a municipal sales tax." I would say that the city of Toronto solicitor is widely respected for his thorough approach to the law.

Mr Phillips: I appreciate that. It does put this in a fairly difficult position, because if that's the case and the government doesn't want to allow that, it has to bring forward amendments to prohibit it. The problem is, if you bring forward amendments to prohibit it, Mr Leach, I gather, is going to be sufficiently embarrassed that he wants to step aside.

My second question is around the issue of fees. Minister Leach was here the other day on the fees, and I think it gives us a little bit of an insight into how the government views municipal fees. Frankly, I'm quite disturbed by it, because the minister said he was very encouraged to hear that one local mayor is going to seek out corporate donors to sponsor such activities as library use for underprivileged children.

What concerns me is that if the minister believes this is the direction we should be heading in, that if you don't have money, corporate sponsors have to sponsor you to use a library -- it's not the Ontario that I personally think is the Ontario of the future. I wonder if city council has had any opportunity to review that direction and any comments on these kinds of user fees.

Mr Tabuns: I'll be honest and say that our council will probably split on this issue. There are different perspectives as to what would be reasonable and unreasonable around fees. My sense is that in some areas, particularly in the use of parks and recreation facilities, there's no way that Toronto city council would support user fees.

Mr Phillips: I used the word "library" because that's --

Mr Tabuns: I think similarly we would oppose charges for use of libraries.

Mr Phillips, different people have different perspectives on user fees. There are instances in which it may make sense, in terms of municipal direction, to charge particular user fees. We charge rates for people to park at parking meters, for instance. It makes sense for us to levy that kind of charge, but it does not make sense, in terms of our culture, our city and our economy, to charge for use of libraries when it's crucial, in this world economy, to have a literate population.

Mr Phillips: There's a section of the bill that I'm not even sure you've had a chance to look at -- I'm switching subjects now -- that if a local municipality -- on page 136, if you have the bill.

Mr Tabuns: No, I don't.

Mr Phillips: Okay. If you don't, I'll give you the highlight of it. It's the section where if a council votes in a way -- a municipality is going to be amalgamated; the other municipalities around decide they want to amalgamate. Even though the council may be 100% against it, the people may be 100% against it, there's a mechanism -- not in Metro Toronto but in other jurisdictions -- where that can happen.

Then, if the council votes, for example, to increase the salaries of the fire department and the municipality that takes it over doesn't like that, the councillors can be held personally liable for adverse financial effects which may be recovered by an action by the successor municipality. In other words, the councillors could be held personally liable if they take, for example, the salaries of their staff up.

Has the city of Toronto had an opportunity to review that section of the bill?

Mr Tabuns: No. That's extraordinary. I think where councillors break the law they should be held personally liable for their actions, but to lawfully make a decision about salaries of employees of a corporation and then later to be held personally responsible for those costs, I find that astonishing.

Mr Phillips: It's a section that I would hope some of the municipalities may look at and give us advice on. I found it personally chilling in that it's the ultimate threat, I think, that we will bankrupt you, and it had to do with municipalities that were going to be annexed. I would appreciate it if the city of Toronto, when you get into more detail on the bill, could give us any advice on that.

Mr Tabuns: If you could extend the hearings we'd be happy to take a second kick at the can.

Mr Phillips: I don't know how you --

The Chair: Thank you, Mr Phillips. Now to Mr Cooke.

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Mr Cooke: Just a couple of questions. You might want to take a look at the presentation that was brought forward by AMO this morning. I assume the city of Toronto is a member of AMO.

Mr Tabuns: We are at the moment.

Mr Cooke: You may want to take a look at their brief. I find it interesting that virtually every councillor who's come forward so far has expressed grave concerns and a need to extend the time and even opposition to the legislation, but AMO, at least in their introduction and their exit from their brief, strongly supported the legislation even though I would say in between they savaged it. You might want to take a look at it and see whether it even comes close to reflecting Toronto or I'd say any other urban municipality in the province.

Do you have a concern -- because I can see something happening with the opening up of more user fees and perhaps sales tax and gas tax and income tax and head tax, and then the minister has the ability, under the legislation, to produce a regulation to stop any user fee or new tax that he doesn't like.

A couple of things can happen.

First of all, from an opposition point of view, I can assure you that I know what will happen in the Legislature. Every time a municipality introduces an unpopular user fee at the local level, the first thing that's going to happen in question period is, we will stand up and say, "That's not a good user fee; will the minister intervene?" because ultimately the minister is responsible. He has the power.

But more importantly, if on the one hand the government is saying, "We're trying to empower municipalities," and then on the other hand they reserve the right to be the hero, how do you interpret that in terms of empowering municipalities?

Mr Tabuns: I thought most of you people ran for office to get away from parking and traffic issues.

I think the Minister of Municipal Affairs, as I've said in my briefing, is going to become the de facto mayor for most of Ontario's cities and towns and that you will be clogged up with a lot of fights over precisely the issues you've outlined. I don't think it makes sense for you as legislators to be dealing with that stuff. It is very problematic in terms of local accountability for financial decisions, and precisely the points you've outlined are things that I think should be turned away in this legislation. We shouldn't have interference at that level.

Mr Cooke: One of the other areas that I have great concerns about, that I don't think in the time we've been given we can possibly properly explore, is when you move to block grants. You know as well as I do that there's a variety of wealth across the province, in terms of municipal wealth, commercial, industrial and residential assessments. You transfer these block grants, then you give the ability to have these new taxes or user fees, and again, there will be a huge difference from community to community in how that can be absorbed.

I think of some of the smaller municipalities in eastern Ontario. If those municipalities were to impose a user fee on libraries -- the difficulties and lack of resources that families have in those communities, the high unemployment rates that are consistent, basically you might as well shut the library down, because families simply wouldn't be able to access libraries -- we're going to begin to see over a period of time in Ontario a real checkerboard of services and access to services, because there won't be the ability to have any consistent services across the province.

Mr Tabuns: You'll see that, I think, and you'll also see, where cities are contiguous, that citizens will be going from one city to get services in the other city, which you see within Metro now. The analogy or the scenario you put forward of cities in eastern Ontario, where people wouldn't be able to go to the libraries because of user fees, would apply equally well in Toronto. There are big chunks in my ward where a lot of people would not be able to go to the library, period, if there were any charges.

Mr Cooke: Those of us who don't represent a riding in Toronto tend to think of Toronto as the big office towers downtown and the huge amount of commercial and industrial wealth that is Toronto. If there were a whole host of new user fees put in place, what impact would that have on constituents in your east Toronto ward?

Mr Tabuns: I would say it would mean a sharp cut of services to those people. In my ward I have a large percentage of people on very low incomes, both working people and people on social service allowance, and they would not be able to go to the pools; they wouldn't be able to go to the recreation centres; they wouldn't be able to use the libraries. Even now a lot of those people are extraordinarily stretched just paying rent and food, period, so I think they'd have tremendous difficulty.

If you look at Toronto, south of Bloor and then parts of the northwest end, you'd see very sharp problems for the population; north Toronto not as much of a problem -- different demographics.

Mr Young: On a point of order, Mr Chair: I'm just curious. We had a presentation from Councillor Kyle Rae, so are you here, councillor, representing the board of health or just as an individual?

Mr Tabuns: I'm speaking as an individual.

Mr Young: Thank you.

The Chair: It's not an appropriate point of order.

Thank you very much for appearing today before the committee.

Mr Tabuns: Thank you for the opportunity.

The Chair: Just before we break, our esteemed clerk would like to have a quick word with us.

Clerk Pro Tem (Ms Deborah Deller): Just one housekeeping matter: Earlier today I handed out tomorrow's agenda for you. I now have a more recent update, and just to avoid confusion, I've put an asterisk in the upper left corner with the date and time, and as the updates come in through the day I'll revise that.

The Chair: Thank you. We'll recess until 1 pm.

The subcommittee recessed from 1157 to 1300.

BRAMPTON BOARD OF TRADE

The Chair: Could I have members from the Brampton Board of Trade come forward. Good afternoon, sir, and welcome. You'll have half an hour to make a presentation, which you can use as you see fit. You may decide to leave some time at the end of your presentation for questions and responses. I'd appreciate it if you'd read your name into the record for the benefit of Hansard and committee members.

Mr Bob Malcolmson: My name is Bob Malcolmson and I'm the policy analyst for the Brampton Board of Trade. Good afternoon, ladies and gentlemen. I'm here today representing the more than 1,000 members of the Brampton Board of Trade, which employ some 60,000 people in Brampton and the region of Peel.

The purpose of the Brampton Board of Trade is to represent and actively promote the interests and profitability of Brampton businesses and its members. Three of the board's major goals are to build and maintain support for control of taxation and expenditures affecting the tax community of Brampton; to promote the most efficient methods, including privatization, of delivering government services; and to create an economic environment which is positive and attractive to new and existing businesses.

Today we are here to share with you our thoughts on two areas of Bill 26, education and municipal restructuring, and lend support where appropriate. We feel the government is on the right track to get Ontario's fiscal house in order.

In February 1994 the Brampton Board of Trade adopted an overall position that any additional government spending, at any level, on programs must be funded from current budgets by a reallocation of funds from existing programs; and further, the Brampton Board of Trade would oppose additional government spending through increases in taxes at any level.

In our letters to not only the province of Ontario but the Prime Minister of Canada, the Peel Board of Education, the city of Brampton and the region of Peel, we went on to state, "Governments at all levels must bring their financial house in order and adopt a philosophy of spending fewer dollars than they bring in and that it is essential to look at tax reduction and reallocation of funds from existing programs to reduce the tax burden and/or fund new ventures."

The Brampton Board of Trade maintains the position that governments, municipally, regionally and provincially, must be committed to downsizing of government, to cost reduction as government policy, accountability to the taxpayers, less government and the elimination of government duplication.

This whole restructuring bill is about taxes and the cost of government to individuals and businesses. Bill 26 is about, as fearmongers would say, the onslaught of poll taxes and user fees. Actually, it is about accountability. The fact is that municipalities must overhaul how they do business. Municipalities must focus on essential core services and deliver them more efficiently, at less cost and with less administration.

Our message today from the business community remains unchanged from two years ago: no more taxes.

For the restructuring to work, municipal governments must be reorganized. We need smaller, less costly local government, less duplication, real cost savings and audited benchmarking to show the results. Business feels that all possible government services must be open to private sector tenders.

The Ontario government must realize that the solution to the tax crisis is not to redistribute the tax hit. Local municipalities must realize that the solution lies in savings in government spending at all levels, not the introduction at the local level of poll taxes and user fees. I guess what I'm trying to say is that the one taxpayer who pays all the bills has hit the tax wall.

We know the provincial government is listening to the taxpayers. Now we must get the message to the local level that they must get their spending under control. Tax hikes are unacceptable and out of the question. As an aside, we are very comfortable working with the city of Brampton and have a very good relationship with it.

Municipal governments' red tape and regulations are killing small business, stifling the growth of business in Ontario and burying the average taxpayer. We are pleased to see that the new provincial government understands that business needs less red tape and regulations. It is time that municipalities, regions and boards of education redesign their bureaucracy keeping this in mind and become more accountable to the taxpayers.

For example, to fit business needs in the 1990s and to create employment, land use is extremely important. When proposing development of lands, business needs to be able to do one-stop shopping, not go to the municipality for approvals and then to the region with the same plans looking for basically the same approvals. It would be ideal to have to deal with only one level of bureaucracy and to gain a decision from that.

As an example, for a small business to get approvals to develop and open a business in one Ontario community, the business must deal with no less than three levels of government, five special bodies, 15 different departments and two planning departments. After getting all these departments, agencies and levels of government to agree, and prior to opening their doors for business, they would be required to pay regional development charges, municipal development charges, land use permits, property tax, business tax, land transfer tax and, possibly in the future, education development charges.

Once they're open, if they get that far, the business must now deal with myriad provincial and federal tax regulations. The business community firmly believes there are too many regulations, government red tape and bureaucracy, and currently too few, if any, decision-makers at the local level.

The section in the bill dealing with the amalgamation of municipalities or the possibility of some municipalities disappearing may not be harmful. Initially, business is attracted to settle in a certain area for economic reasons, infrastructure and services, closeness to market, abundant labour force and efficient transportation routes. For the most part, municipal and regional boundaries are transparent to the average individual, especially if you're travelling across the GTA on Highway 401. Business only considers boundaries when determining which government controls their taxation, regulations and services, and not in the normal day-to-day operation of the business.

As we stated, business is concerned about the availability of a good labour force, effective and efficient transportation routes and infrastructure services, which allows them to work on a just-in-time basis, ensuring that they will remain competitive in a global economy. Business is looking for efficient and responsive local government and ideally wants to deal with one location for all government services: one-stop shopping.

The Brampton Board of Trade feels that Bill 26 will allow for more flexibility at the municipal level to deal with government efficiencies or inefficiencies of services which affect the community. Bill 26 must contain the flexibility to allow for private sector delivery of service, a clear delineation of program responsibilities and allow for the elimination of government duplication and redundancy. However, in order for this to work, the municipalities must be committed to downsizing, cost reduction and accountability.

We caution local governments facing provincial cuts that taking the easy way out -- introducing user fees without first dealing with inefficient bureaucracies -- is not the answer.

Business is not opposed to paying its fair share of property and business taxes. As the Fair Tax Commission has stated and the various reports indicate, governments must find a way to deal with taxes. In this age of the global economy, the technology of the information highway and the just-in-time business philosophy, it is not as important for business to be located in major centres. Business believes the constant tax increases must stop.

A commonsense approach to transportation, regional borders, planning, land use, water, sewage, waste removal, interest groups and policing must be found. Each municipal and regional master plan should be blended with the plans for transportation and infrastructure within the province. It currently appears that each municipality acts independently. Transit over the years in the GTA has been designed region by region and has had little respect for cross-boundary transit and arterial roads. This weakness must be addressed.

We feel Bill 26 allows for the flexibility to address the issue of being overgoverned and should allow the municipalities to disentangle regional and municipal planning departments, official plans and how governments affect economic development and economic redevelopment. Possibly the structure of the boards of education could be included, allowing education to be more cost-effective.

Disentanglement of governments, including the purpose of such bureaucracies like the conservation authorities, must also be addressed. To be effective, overlapping services in the current regional-municipal structure such as roads and maintenance, services of police, fire and ambulance, hydro, along with water and sewers and waste management and recycling, should be reviewed to see if it is feasible to privatize these services or turn them over to commissions similar to the operation of the police commissions or hydro commissions.

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The Brampton Board of Trade feels there should be a provincial restructuring of service responsibilities. The province should be primarily responsible for regional plans, transportation, social welfare, health and hospitals, natural resources and economic development. It should seriously look at the elimination of conservation authorities, rolling the responsibility back to the Ministry of Natural Resources and the local community governments.

The current regional structure for policing, waste management, recycling, social services, education and hydro electricity could remain intact, with the idea of turning these areas into commissions similar to the makeup of the police commission, with direct responsibility and accountability to the locally elected government officials appointed to the commissions. These types of services could cross municipal and regional boundaries.

The municipal government would take direct responsibility for all roads, road maintenance, water and sewers, planning, economic development, parks and recreation, cultural, fire and ambulance, public works, property taxation and assessment within the boundaries of their communities.

Although the restructuring of boards of education is not covered in the bill, we feel that if it addressees amalgamation of municipalities, it must also address education. In many Ontario communities the cost of education is 60% of the local property tax base.

While reviewing and determining the future of municipalities and regions, the cost of, as well as the structure of, school boards must be addressed. We feel rigid spending restrictions should be placed on boards of education and more effective use of capital funds through cooperation between boards of education with private sector deliverers or through public-private sector partnerships and joint purchases of services. The board of trade supports amalgamation of school boards. All this would lend to greater accountability to the taxpayer.

It makes no sense in this day and age, when building schools in a municipality, to have a developer set aside a plot of land in a new development for both a separate and a public school on the same piece of land and then have the boards of education insist on placing the two schools at either end of the property with separate parking lots, power plants, playgrounds, and possibly separate student computer centres and separate busing for each school. It would be more cost-effective to put the school in the middle and combine the resources.

On February 15 this past year, our board of trade gave a clear message on behalf or the business community to the Peel Board of Education: No more taxes. Our board asked the Peel Board of Education trustees to cut expenditures by 25% over their term of office, yet the Peel Board of Education raised taxes by an average of $90 per household -- forever.

We asked the Peel Board of Education to further commit to a more cost-effective system and have the will to create it, to commit to cutting programs to fit the budget and more fully utilize its assets and not rely on tax increases, and to consider combining school boards to relieve the pressure on the demand for new schools. The latter would allow for the sharing of schools, reduce trustees, decrease the bureaucracy and save tax dollars.

Our message today from the business community remains unchanged. It is necessary for all school boards to look to tax reduction and reallocation of funds from existing programs to reduce the tax burden on individuals as well as business. The education system must get expenditures under control.

Taxpayers are demanding more value for their money and an excellent education for their children at an affordable price. The money must be spent in the classrooms for quality education so the students and business can compete in the world marketplace. The business community recognizes that education benefits all of us, and in that regard, all of us should pay our fair share of taxes.

Business also understands that in this economy we have to restructure and implement cost-saving measures to provide the necessary services at the lowest possible cost and in the most cost-effective manner to the taxpayers.

Last summer, the Harris government was voted into office based on a common theme: accountability to the taxpayers. It is now time to stay the course and be accountable.

The government, with bills such as Bill 26, is showing it is prepared to make the tough decisions now and bring in responsible changes and spending cuts. It is no longer a case of what we would like to have, but more one of what we can afford.

Overspending and expecting to remain competitive is ludicrous. We must all get down to basics with a line-by-line review of each department and each expense in government.

Our tax burden in Canada is higher than any of our major trading partners. That's driving companies, and jobs, out of Canada. We must cut costs and change the way government does business.

I would like to thank the committee on behalf of the Brampton Board of Trade for the opportunity to appear here today, and I would be most happy to answer any questions you may have.

The Chair: Thank you, Mr Malcolmson. We have five minutes for each caucus, starting with the opposition caucus.

Mr Phillips: Thank you very much for the brief. I'm sure you share our concern about the complexity of the document. You mention the need for an integrated public transit system, that it's "been designed region by region and has had little respect for cross-boundary transit and arterial roads."

Mayor McCallion, from a neighbouring municipality to yours, was in the other day saying that the municipalities in the greater Toronto area, and I assume that included Brampton, had been looking at an integrated transit system. What she said was, "The only way we can have integrated transit in the greater Toronto area -- and we discussed it, all the municipalities involved" was by imposing a gasoline tax. She said, "We would have asked the government to pass that, but now" -- she's talking about the bill -- "we might have the opportunity to put it in."

Mayor McCallion is saying she's very pleased with this bill because, among other things, it does give the right for municipalities to impose a gas tax. I gather that's the route the municipalities in the greater Toronto area have determined they would pursue for an integrated transit system. Does the Brampton Board of Trade support that part of the bill?

Mr Malcolmson: Let me clarify what I meant by "cross-border boundary transit and arterial roads." Yes, there is the busing routes to consider, but what you have to reflect upon is the actual mass transit. You get on the highways and they're clogged up, which is giving problems.

When you look at the road structures region to region, if you take Halton region to Peel region and go right through to Etobicoke and so on, you can go from myriad two-lane to four-lane to six-lane to two-lane to five-lane highways. Nobody thought. Once they got to their boundary, "It stops here and somebody else can worry about the other end." In that regard, I'm talking about the transit in respect to vehicles, as well as buses.

I know there is a lot of discussion about interboundary busing and that sort of thing, and I'm not fully aware of it. As for supporting Mayor Hazel on her gasoline tax, any municipal government that would try to impose any kind of user fee or poll tax without looking at cost first would be absolutely ludicrous, because voters --

Mr Phillips: Do you think the bill should specifically exclude the opportunity for municipalities to impose a gas tax or a head tax or a local sales tax?

Mr Malcolmson: As I said, if a municipal government does not say, "Here's what we're going to do," if they try to impose extra taxes without trying to restructure, they'll only be able to do it once and then they will not be there the next time around. I don't think any municipal government in Ontario at this point in time is going to start saying, "Our easy answer is a poll tax."

Mr Phillips: You don't mind it being permitted in there, it's just that you don't think anybody will impose a gas tax.

Mr Malcolmson: They can have the opportunity, but they have to act responsibly and be accountable to their taxpayers. If it works in that community, fine and good, and if it doesn't work, they'll find out real quick.

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Mr Crozier: Mr Malcolmson, if I kind of slip and call you Bob, it's because we're fellow life members of the Kinsmen Club, and I've enjoyed the experiences we've had in common.

Mr Malcolmson: That's quite all right.

Mr Crozier: I want to go to accountability and just get your opinion on something in the bill, when we read that "fees and charges that are in the nature of a direct tax for the purpose of raising revenue" is allowed.

Would you comment on the fact that if a municipality chooses to do that, there is no appeal to the OMB and they can put that in by bylaw, and they can also by bylaw absent the electors from approving this bylaw. In other words, there is no way to appeal this.

Mr Malcolmson: Could you cite me an example of a fee they'd put in?

Mr Crozier: If they put in a gasoline tax.

The Chair: I'd appreciate if you could go further on that conversation, but we're starting to get into Mr Cooke's time and I wouldn't want that to happen.

Mr Malcolmson: Sorry I couldn't answer it.

Mr Cooke: Well, I might give you a chance.

Thanks very much for your presentation. I agree with some of the comments you've made on the need to rationalize and restructure our school board system, which is something I was involved with. I can certainly tell you that when you say that, every school board in the province's response is: "Yes, the rest of the school boards should be restructured. We're already doing things cooperatively with everybody else and we're doing it more efficiently than anybody in the entire world." It's going to have to be driven at the provincial level, because it will never happen at the local level.

There are some examples in the province of schools that have been built, the Catholic system and the public system, in joint facilities, and not only are they less expensive but they provide a far superior education for kids because you can have broader facilities when you're saving money and reinvesting it. Hopefully, that will happen at some point. It's not contained in this bill.

I'd like to get a better understanding, because I think you are fairly supportive of this piece of legislation. If I can summarize what I think you're saying, it's that because part of the bill provides for more flexibility for local governments, it's therefore supportable. I'm not quite sure I understand where the additional flexibility is, other than in the area to tax.

I assume you mean every other municipality than Brampton, because you seemed to indicate with one comment that Brampton was pretty well run and that you had no quarrels with that local government. But when I look at others -- Hamilton is one that comes to mind -- they actually share staff between the regional government and the lower-tier Hamilton government. So it can be done under the current circumstances without a change in legislation.

The difficulty has been, how do you get folks to do it? Everybody claims they're already doing it very efficiently. I guess I'd like to get a better understanding from you of what this bill does to encourage more rationalization and restructuring at the local level.

Mr Malcolmson: To start with, if nothing else, it certainly has brought this whole issue to light about amalgamation of municipalities and the potential. If you look at the greater Toronto area, there are many municipalities that run effectively and ones that don't. Maybe they will or won't be swallowed up or changed or altered. That's a question they have to be involved with.

Getting into this situation, let's make it down to the issue of one-stop shopping. If nothing else, if the municipality through this bill gets the full responsibility for one-stop shopping, if the businessperson or the person who goes to get a piece of land altered or an addition on the back of his house ends up only dealing with one person at one level of government, I think the bill has done its job.

I live in a small rural community, and if you want to put a back porch on your house the paperwork and bureaucracy you have to go through is horrendous, plus the fact that every agency has to come back with a comment and one agency won't comment until the other agency comments. I've sat on committee of adjustments where you'll get 25 agencies and departments that are supposed to comment, and 15 will come back and say, "If the conservation authority comments, I'll comment, and if the health department comments," that sort of thing. Let's get rid of that.

Mr Cooke: I don't disagree that that would be an important and good goal to achieve. I'm not sure what's in Bill 26 that does that. That's the point I'm making. I think municipalities that want to do that could do that under the current structure, but there's nothing in Bill 26 that's going to see that happen. To me, that's one of the problems.

Let me get back to the tax question for a bit, because I'm not sure I understand. If this legislation gives municipalities the power to do sales tax, income tax, head tax, gasoline tax, we could end up having, in some municipalities, the GST, the PST and the MST, and they could all be on different bases. If there's a problem now between the GST and the PST, just think what there'll be with a third tax.

The Chair: Sorry to interrupt, but we've just gotten to the end of Mr Cooke's time.

Mr Joseph N. Tascona (Simcoe Centre): Mr Malcolmson, I've gone over your presentation and I thank you for it. I note some of the key principles of the reform you're looking at are accountability in local government and keeping the expenditures under control.

One area I want to discuss with you is schedule Q, dealing with the mandatory criterion for interest arbitrators which deals with fire services, police services and hospitals. The purpose of those changes is to control costs. We certainly believe it's in the public interest to control costs. The mandatory criterion in effect deals with the ability to pay. What I'd like to know is, do you think it's in the public interest for arbitrators to be required to consider such factors as ability to pay in order to avoid passing on tax increases, or reduction in service levels where taxes can't be introduced? What are your thoughts?

Mr Malcolmson: On a personal basis, I've had the opportunity of reading the AMO report, and it's recommended one clause that's now missing, that ability to pay without additional costs to property taxpayers should be put into schedule Q. We're down to the realization that the federal government understands there's no more money, the provincial government understands there's no more money, and now we have to get it down to the local level. These people have to understand -- not necessarily the elected official, but possibly the bureaucracy that runs the communities -- that they can't keep going back and asking for more money. If that means they have to put a clause in that schedule saying, "You have to consider that there'd be no tax increases on the ability to pay," as a taxpayer and a homeowner, a property taxpayer, I'd say thank you very much, because we can't keep paying money out the door. We don't have it any more. I'm not speaking on behalf of business; I'm speaking on behalf of the individual homeowner, who is taxed to death. They just don't have it.

Mr Tascona: You've read the AMO proposal. They're looking for us to strengthen the mandatory criterion for arbitrators, and I take it you share that view.

Mr Malcolmson: I've read the five recommendations. I think they have a lot of merit and should be considered by this committee, absolutely.

Mr Tascona: Do you believe the government is moving too quickly with our restructuring initiatives?

Mr Malcolmson: Too quickly? In the past five years we've gone through some very tough times. The faster we get the thing restructured and start saving the money and get this province back on track and working, the better.

I've been through the position where I shut down a plant and put 30 people out of work. I've had to rearrange my life because of the economy, and that's what's happened during the recession. I think Ontario has had enough of hard times, and let's get this over and done with. If you go too slowly you're going to have a problem. You have to take a look at it and say, "We're eventually going to get to the point where the benchmark is hit and we have to rethink what we're doing," but until you get to that point in time you don't know you've hit it.

Mr Hardeman: One of the main questions -- I think you dealt with it in your presentation -- is accountability. Do you see it that as you're getting closer to the people, the local elected officials are inclined to be more accountable for the spending of the tax dollars and then the ability to raise it?

Mr Malcolmson: You'd have to look at the community you're living in and the structure of that local council. If you're talking of a small community that has a part-time council as opposed to a community that has a full-time council -- it's not one size fits all. Everything changes. You have to look at each individually, separately, and say, "Can this community structure itself that way?" Many of the small towns may be running by remote control, and maybe it works well that way for the accountability factor, because the local town clerk happens to be the next-door neighbour or the barber's brother or sister. You have to take all that into consideration. In the big metropolitan areas, you'd have to take a different structure to it.

The Chair: Thank you, Mr Malcolmson, for your half-hour today. We appreciate your taking the time to appear before the committee.

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PROSPECTORS AND DEVELOPERS ASSOCIATION OF CANADA

The Chair: Could I please have representatives from the Prospectors and Developers Association of Canada come forward. Good afternoon, gentlemen, and welcome to the standing committee on general government. You'll have half an hour today to make your presentation. You can use that half-hour as you see fit. You may decide to leave some time at the end of your presentation for response and questions. I'd appreciate it if you'd take the time at the beginning of your presentation for the benefit of committee members and Hansard to read your names into the record. Thank you.

Mr R.H. Tays: My name is R.H. Tays, Reg Tays. I'm presenting a brief today on behalf of the Prospectors and Developers Association on schedule O of Bill 26, the amendment to the Mining Act.

The Prospectors and Developers Association of Canada is a national organization representing the Canadian mineral exploration sector. Our 4,000 members include individuals ranging from prospectors to mining company executives, junior exploration companies, consulting and service companies, financial institutions and large, multinational corporations.

Let me just finish one more part and then I'll let Mr Rayner come in here.

As Ontario is Canada's largest mining jurisdiction in terms of number of mining companies and individual residents, the largest proportion of the PDAC's membership also reside in this province.

Mr Wally Rayner: I'm Wally Rayner. I'm a director of the Prospectors and Developers Association, and as Reg's preamble said, we represent the prospectors in the province of Ontario as well as across Canada. I'm also the chairman of the minister's Mining Act advisory committee. It's a committee that was established in 1991 to review the new Mining Act that came into effect on June 3, 1991.

Schedule O came to us as a little bit of a shock. We'd gone through on our Mining Act advisory committee reviewing an omnibus bill that was put in front of our MMAAC committee on October 20. There are 40 items in that bill, some of which are reflected in the current schedule O, but on seeing schedule O, there are obviously a lot more amendments to the Mining Act that we didn't really get a chance to consult on.

Having worked in the mining business for 22 years as an Ontario-based exploration geologist, we in the mining business soon learn that if you have any doubts about the Mining Act or regulations, the first thing you do is consult with the mining recorder to find out what you should be doing.

The current Ontario Mining Act was developed after a huge amount of consultation which started in 1988 and ended with the Mining Act in 1991.

I think, based on what we read in schedule O, we're of the opinion that we'd like more time to review these changes. We realize there's an agenda that we have to move on in the province of Ontario to restructure and create some savings. However, we are quite concerned that some of the things that are in schedule O could be detrimental to our industry.

In general form, I'm not going to go into any details that I have in the presentation word by word, but we're concerned about some of the definitions. A lot of what is interpreted in the act and the regulations hinges on these definitions, and some of the wording is not too precise. It leaves a lot of room for interpretations.

There are two basic parts of the amendments. There are the amendments to a lot of the act which are housecleaning items. Then we get to what is known as part VII of the act, which is the mine rehabilitation portion. We have some concerns here. However, in general, we're in agreement with the idea of self-regulation. We're in favour of some of the proposals for financial assurance.

I'll leave it at that point and turn it over to Reg.

Mr Tays: Just to give you a little background, Mr Rayner and I are both members of the PDAC mining regulations committee, which also includes other members with extensive knowledge of mining laws and regulations. The committee members have participated in fundamental work on the current Mining Act and on regulations in other provinces and territories.

As Mr Rayner alluded to, we were aware of the original housekeeping items and certain other consultation concerning part VII. However, when we saw schedule O of Bill 26, we found some of the items very disturbing.

First, there are many more items in this schedule O than originally appeared in the October documents. This has expanded to much more than the housekeeping and comprises fundamental changes to the act.

Secondly, the items which we were consulted on and on which we believed we had reached an understanding with ministry officials have received such change and embellishment as to significantly alter their meaning and intent.

Thirdly, many of the suggested amendments appear to either conflict with each other or existing parts of the act.

PDAC's main concern or main interest is in connection with mineral exploration. We wish to emphasize that part VII has a significant impact on exploration, and we believe some of the changes will discourage exploration activities.

We recognize that mining operations are very important to Ontario, and anything that can be done to make it more efficient should be considered. Mineral exploration is the lifeblood of the mining industry in replacing depleted mineral resources, and it's equally important that this sector remain efficient and competitive. For one thing, combining advanced exploration and mining production in the same section poses concerns for mineral exploration projects. Legislation that is needed for mining production is often unnecessarily restrictive to mineral exploration work and can have a detrimental effect.

In order to attract risk capital to fund exploration, there must be certainty of title, access to land, and confidence that undue risk and cost will not impede funding of such needed exploration to search for new mineral resources.

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We would support measures in schedule O that would benefit the operation of mines and the protection of the environment as follows:

(a) The principle of self-assurance to cover financial assurance.

(b) The principle of self-regulation.

(c) Freedom to explore.

(d) Protection of the environment.

(e) The principle of "polluter pays."

However, with regard to items (b), (c) and (e), amendments to the act in schedule O do not promote self-regulation, and freedom to explore is subject to uncertainty relating to the risk of liability for mine hazards. The proposed changes in part VII would appear to promote "user pay" rather than "polluter pay."

We do not believe that the amendments set out in schedule O will achieve the objectives of the government to reduce administration costs by allowing self-regulation, provide confidence to investors and encourage exploration.

It is our opinion that if the act is amended along the lines suggested in schedule O, it will require more ministry staff to administer it and secured lenders will experience an increased level of uncertainty and explorationists will feel very reluctant to work on or near properties that have previous mine workings.

We do not believe that all of the amendments contained in schedule O can be adequately analysed or discussed in the consultation time line set out in Bill 26. As a result, the attached schedules comment on only those items which we feel very much are significant. Schedule A addresses sections of concern, except for part VII. Suggested changes for part VII are listed in schedule B.

Given the short time frame for reviewing this legislation, we have not had appropriate time to circulate these comments to other members of our regulations committee, therefore, our comments should not be considered complete or final. We would like to have an opportunity to participate in a more in-depth review of the act as it is affected by amendments set out in schedule O when that can be arranged.

Thank you very much for allowing us the time to make this presentation.

The Chair: We've got about five minutes per caucus for questions. We'll start off with Mr Cooke.

Mr Cooke: Thank you for your presentation. Again, you have I think reinforced what a lot of people are saying before the committee, that originally the amendments to the Mining Act were sort of presented to us in a way that, "They're not major amendments, they're just part of this omnibus bill and may seem a little bit out of place because we're really talking about government restructuring." But everybody that's come before us has told us that this is a bill in itself, that this is a bill that deserves and requires independent study.

You probably know that if it wasn't for the fact that we put forward a fairly persuasive argument and some tactics in the Legislature to force public hearings, you wouldn't even be here presenting to us today, let alone requesting to appear before us again when you've had ample time to analyse the bill. The bill would have been law today, or under the original proposal would have been law a week and a half ago.

I guess your presentation, out of all of them so far, distresses me the most, because it might be predictable that the Ontario Mining Association would support the amendments and the environmentalists would express some concerns, but you're neither. You're the prospectors, you're in the industry, you understand it quite well, and you're saying you haven't had time and that you have some concerns, that there are mixed messages being given in the legislation and it's not going to accomplish what you think the government wants to accomplish with the amendments.

I don't think there's going to be an opportunity for you to come before the committee again, because we're on the road, unless you're going to be meeting us in northern Ontario. I certainly encourage you to send some material to us, but I expect that what you're saying is that the best thing that could be done is for this section to be pulled out of the bill and dealt with separately, as a separate piece of legislation, so that we can get it right, rather than passing something that's going to disadvantage your members in the industry.

I'd just like to get an idea from you about your involvement in developing this. The Ontario Mining Association seemed to indicate that it was fully supportive because everything that is in the legislation is something that it has advocated for and it was involved in the consultation. Environmentalists say they were not involved in the consultation. I understand from your presentation that there was a process, but at what point were you consulted about specifically what was going to be put in this legislation?

Mr Tays: I think it's appropriate that Wally answer that, but I would like to emphasize that the Prospectors and Developers Association would like to see this move on quickly, though. We don't want a long delay in new legislation.

Mr Cooke: But you don't want --

Mr Tays: But we don't want it here.

Mr Cooke: Yes, okay.

Mr Rayner: It has been a long process. In the past, I worked on the Mining Act advisory committee for many years, and just recently, this year, I was the chair of this committee. It took us three years to produce some amendments to the staking and the assessment work regulations. This isn't dealing with the act; these are regulations that we worked on.

We had seen the 40 omnibus bill items, which were housecleaning items. Of the 40, there were maybe three that we were a little concerned about, but not really that concerned. So we thought: "Well, this is fine, this can go ahead. We give our blessings to those, with some cautions, on these three items."

Of the amendments that came out in schedule O, one item was the prospector's liability for abandoned mine hazards, on which we had extensive discussions with the ministry. I think it's section 150 of the amendments. We had spent a lot of time talking about that issue and how we might fix it. That is really as far as it got. There are lots of other amendments that have come in, especially with changing the purpose of the act, adding in the idea of health and safety. Everyone is concerned about health and safety, but we have the Occupational Health and Safety Act that should be dealing with these issues.

The Chair: I have to change to the government caucus now. Mr Sampson.

Mr Sampson: Thank you very much for your presentation, inclusive of the suggestions you have for the revisions to the proposal in front of you. You made a comment that I found intriguing. You mentioned that you are in favour of self-regulation. Can you tell the committee what the impact would be of increased self-regulation with respect to mine activity? Perhaps you can also comment on the impact, as we've heard from other groups, on environmental factors, environmental issues?

Mr Tays: When we say "self-regulation," we don't mean no regulation. We mean regulations set out that we can follow so that it doesn't require a lot of our time and the ministry's time in explaining how we must do something.

Advanced exploration probably is the most unclear one. There are many matters that fall into the advanced exploration category that do not require closure plans or anything more than perhaps notifying the director that we're doing that work. If we know what the rules are, there's no reason for the director to have to have anything more. We're not opposed to spot checks or any kind of checks, and it's appropriate that we would make appropriate reports on those things, but there's no reason, though, that we should have to have the director's permission to do that kind of work. That's where we see self-regulation.

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Most companies have environmental policies today which we, in our company anyway, follow rigorously. So anybody doing advanced exploration has to follow their own policy, not just the government's policy.

Mr Sampson: So in many respects the self-regulation internal rules will be even tougher than what we could apply as legislators as far as environmental protection is concerned, in your view?

Mr Tays: Absolutely.

Mr Sampson: With respect to mine activity, is the ability for your industry to self-regulate itself to some degree going to hinder mine activity, increase mine activity?

Mr Tays: I think it should encourage people, if they know what the rules are, to follow them. Yes, it will save us money and it'll make us more efficient.

Mr Sampson: So self-regulation should be a good news story for the industry as far as cutting the red tape is concerned, shouldn't deteriorate the environment, in your view, and should provide some growth and activity in the mining business?

Mr Rayner: It may impose a little cost on the junior sector of our mining business because we're no longer having an approved closure plan for advanced exploration or mining. It's going to be a certified closure plan which will have a professional engineer's seal on it. If you don't have a professional engineer qualified in your group, you may have to go outside and hire someone to do this, whereas previously you could provide your closure plan to the ministry, to the director of mine rehabilitation. They would approve your plan and actually assist you to develop the proper plan.

Mr Sampson: But in the junior developments, you'd probably want that tighter control anyway.

Mr Rayner: Absolutely. Oh, yes. As I say, there will be an added cost to industry, but it'll be a saving for the government.

Mr Tays: But I want to emphasize that self-regulation is not in the amendments as set out. It does not achieve that end.

Mr Sampson: But you've made some suggestions here as to how we might refine the self-regulation as proposed, inclusive of the self-assurance issues.

Mr Tays: Yes, and we have not addressed the actual issue of doing the mining. We've left it up to the mining association of Ontario to address those issues, mine production.

Mr Sampson: Yes, right.

Mr Phillips: I appreciate your presentation. I think you know we share your concern or frustration -- we'll call it frustration -- about the process in that I think you've indicated that this bill is absolutely fundamental to you and your industry. I'm very disturbed by some of the language you've had to use here, that many of the suggested amendments appear to conflict with each other.

You're very concerned that you haven't had time to review all of the proposed changes. You do not believe the amendments "will achieve the objectives of the government to reduce administrative cost" or "provide confidence to investors." You've indicated that it's going to "require more ministry staff to administer it and secured lenders will experience an increased level of uncertainty and explorationists will feel very reluctant to work on or near properties with previous mine workings." You do not believe that all the amendments contained in the schedule "can be adequately analysed and discussed in the consultation time line set out for Bill 26."

I think you're sending a signal to the Legislature that what we are dealing with here is important material and we're just simply not giving it the time it deserves and we're not giving the industry the time it should have to analyse it and come forward with recommendations. I'd just say what Mr Cooke said, and that is, frankly this would have been law today at 6 o'clock. One floor above us it would have become law today. We've delayed it until January 29, but the government has recently just indicated it is not backing off on that timetable.

We will certainly take into account your concerns. I would urge you to work as hard as you can between now and January 29 to get the government to bring forward the amendments that are required to clean this up.

I guess in the little bit of time we've got here, though, it would be helpful for you just to signal the two or three areas that are of biggest concern to you. I'm frustrated by this because if you look at the agenda of people we have, the next people we'll have on could be from the municipal sector and then there will be somebody from the pension area and then there will be the police in here.

We're dealing with this huge bill, but what are the two or three areas that you are most concerned with, if you could signal that for us here?

Mr Tays: I guess the first one is the matter of mine hazards and people who have leases. The provision to allow them to surrender it is not adequate as it is written. We are supportive of that concept, but it should be amended. Maybe Wally has some comments on that because he was closer to that one than I was.

Mr Rayner: We're in support of that concept, or the government policy that the prospector will not be liable for these old sites because he has taken ownership to a mining claim. There's precedent currently that the mining lands commissioner has ruled on that links this right back to the unpatented claimholder, and we're quite concerned about that. The reason we're concerned is because of some of the loose wording; you know, the wording such as "materially disturbed" land or ground. That's very subjective. I guess what we'd like to see is these definitions firmed up so that we know what we're dealing with.

Mr Phillips: That would be your number one priority?

Mr Rayner: Yes.

Mr Tays: I think the concept of "polluter pay" is really quite fudged, and that's not coming from this new legislation; that's in the current legislation.

Prospectors need to have confidence that they can go out and find mines and not be liable for the hazards of the past. So I think the government has to come to grips with that issue, and that's a fundamental that runs right through it. That's a serious issue and it needs to be developed.

As well, secured lenders shouldn't have the cloud of liability for mine operations if they're going to fund. Some of the meanings get lost there. If you become an owner, you are naturally responsible for whatever you buy, but if you're simply a lender, there shouldn't be any cloud on you for that. I think that would encourage mining in Ontario a lot, if we didn't have that kind of cloud on us.

The Chair: Thank you, gentlemen, for appearing today before the committee.

PHIL CUMMING
DAVID SHARPE

The Chair: May I please have Mr Phil Cumming and Mr Dave Sharpe come forward.

Good afternoon, gentlemen, and welcome to the standing committee on general government. You'll have 30 minutes today to make your presentation. You can use that time as you see fit, but you may decide to leave some time at the end for questioning. I would appreciate it, for the benefit of Hansard and for committee members, if you'd introduce yourselves into the record before you begin your presentation.

Mr David Sharpe: Thank you. My name is David Sharpe. This is a private presentation of myself and Mr Cumming. I'm a part-time student of public administration at Guelph, one of the universities in Ontario. I've served as an elected official and an appointed official at local and upper-tier municipal levels, and I work as a municipal employee as a firefighter.

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Mr Phil Cumming: Good afternoon. My name's Phil Cumming. I'm in the same capacity, a municipal firefighter. I'm also a small business owner, an entrepreneur of sorts. Again, we're here on a private basis only.

Bill 26 is critical to putting the multilevel government house in order. We strongly support the premise that this province must act boldly, decisively and quickly to turn around the deficit problem by the year 2000. Bill 26 gives some powerful tools to ministers and municipalities.

The question then becomes, how do you use these tools to effect permanent and fundamental change? In other words, how do new and innovative service delivery models become reality?

The first requirement is an open mind at all levels of government to explore new methods and an iron-willed determination to make the necessary changes to facilitate their implementation. Both attributes are being exhibited by this government, for which it deserves a strong commendation.

This proactive approach can achieve many positive results. One such result would be that the typical bureaucratic inertia will be expunged from the system. The politicians must send signals to the entrenched career civil servants that status quo is a profane word and that this new paradigm is not just a little bump in their agenda to be endured but a real search for an answer to the question, what should government's role be in today's society?

In our opinion, government-business partnerships that develop into a web of mutually advantageous links within and among communities of interest and other agencies are the best way to capitalize on each one's strengths. It is the way to implement essential community services while unleashing the potential of business to innovatively blend existing valuable people and resources for least-cost solutions.

We must capitalize on the vast experience and commitment of the existing workforce and help them achieve increased security by unleashing their own creativity. We must tear down the Berlin Wall of antiquated thinking inherent to our current structures. This new model, when embraced by each partner, can help all parties achieve their goals. The workers get increased job security; the ratepayers, good service; and the municipality, assurance of efficiently delivered products.

This brings us to a conceptualization of a three-part model in provision of government services: recipients, the public; arrangers, Queen's Park and/or local councils; and providers, currently mostly monopolistic government departments or ministries. Today, for a whole range of services, government decides that a certain service ought to be provided collectively and then proceeds to provide it as a monopoly with no notion of alternatives to compare modes of delivery or efficiencies. By using this new three-part model and moving the provision of services into partnerships with other providers both the stability of government and the dynamism of business can come together to enhance the lives of the people of Ontario.

We would like to suggest that emergency services, which are currently provided in a rather haphazard and uncoordinated fashion across the province by both municipal and provincial service providers, must be rationalized to ensure efficiencies. This is not to say that there should be some superagency to provide "one size fits all" service across the province, but there are certainly areas, such as communications, reporting, training, cooperation and procurement, to mention a few, that would be enhanced by larger units in the province.

Each municipality, for example, cannot afford to be prepared for hazardous materials incidents but collectively could have a reasonable response capability, especially if strong ties were forged with industries that have extraordinary knowledge in the area.

This is the web philosophy behind our design of a new paradigm for fire and ambulance service. Initially we are targeting as a pilot project a city- or perhaps county/region-wide model of partnerships forged to address the needs of the public while instituting strong incentives for lower-cost service delivery. We see this as a model for many other operations in the municipalities while acknowledging that some services have already implemented some level of partnership.

Emergency service, like health care, is a particularly sensitive area when dealing with the public. However, we would remind the committee that the initial contact with emergency services is through a privately operated, government-regulated telephone system, and that the ambulance system is in many cases privately run but regulated and licensed by the province. An independent provider could aggregate needs, which cross municipal boundaries, then provide the service level desired.

Some of the provisions of Bill 26 require that the municipalities in Ontario must show the government of Ontario how they are efficient if they want to control their own destiny. If they don't do it satisfactorily, then the government may impose a solution. There are all the traditional bureaucratic and political turf wars to overcome if the usual "meetings, reports and studies" approach is taken.

Let us contrast this with a different model. A salesperson approaches all the service delivery units in a given geographic area and tries to sell a service. A company needs to be quickly aggregated and as soon as it is viable the company implements the solution. The results are the total service cost is lowered and/or the service level is improved.

The company has an incentive to put together a solution quickly, to make its sales. There is also an incentive for each municipality to look at the solutions so it can assure the province that an effective solution has been achieved and it was done locally. Both are outcomes that the province is trying to achieve through Bill 26.

The company effectively is a neutral party and no one perceives that one municipality is taking advantage of another. Further, there is usually a time frame defined when any adjustment in the agreements to change services will keep the services relevant in the changing municipal context.

The people in the province of Ontario need a streamlined, flexible and relevant government and set of services. Bill 26 is necessary and a good response to the unprecedented problems that the deficit has exacerbated. If we don't make a concerted effort today to adjust resource allocation away from bloated, inefficient delivery systems, then we in Ontario will suffer radical, perhaps even fatal, economic surgery by outside international agencies. We have the opportunity to boldly seize our destiny for a better future for ourselves and our children. Let's get on with it.

The Chair: There are 21 minutes remaining in your half-hour. We would like to allot seven minutes per caucus for a response and questions. We'll begin with the government caucus. Mr Tascona.

Mr Tascona: Thank you for your presentation. It's very thorough. With respect to the restructuring of the government, what I sense here is that there's agreement with the need to restructure and the urgency that exists out there. It's interesting, in the past two days we've heard from two provincial federations for firefighters and they're disappointed in our approach to the need to restructure. I'd just like to ask you, as a firefighter member, what encouraged you to come and speak to us today with respect to the message that we're sending out?

Mr Sharpe: In my public administration studies in the last four years I've gone through the exercise of observing the federal and provincial governments, particularly the federal government. Back in 1989 they started with their public service 2000 initiative, and that was to address at the federal level some of the problems we're still trying to address; now it's even come down to the local level.

They went through a legislative phase and it's become an analysis stage now of how well it's coming in. In fact even as late as this spring, I was looking at some work that showed that they still needed work on the implementation part of it, particularly at the mid-level. So it seems to us that there's a need for a whole new model in there to signal to the people that these are different times, that the status quo can't exist and the money's rapidly running out.

I would suggest that someone with 20 years in the system, unless some extraordinary information comes to them, doesn't recognize the changes adequately. I think that's where my studies have taken me and see it happen at the federal level, provincial, and it trickles down. Also, the time frame for trickle-down is rapidly shortening. What happens at the federal level happens locally now in a very short period of time, hence the deficit problems.

It's through my studies primarily that I saw this; also sitting on local councils and observing the operation, having a tremendous sense of staying near the people but having an open enough mind to say that it doesn't have to be the traditional structure, that you can still interact between the service providers and the public. You can have local groups, a volunteer group that oversees or is sensitive to some government service and their group.

Also at the county level we did go through a restructuring exercise about four years ago. There wasn't a great deal of political support among the municipalities, the local reeves and councils and that; hence the part about the turf wars and the studies and all those sorts of things.

I think it's becoming critical now that we make a move in restructuring, whether it's amalgamating municipalities -- if we don't want to do that, if we want to preserve our history and heritage, then maybe we can aggregate those needs in another fashion, and that's really where we're coming from.

We can aggregate those needs and we don't necessarily have to take down that local council. If they want to be the "township of" and continue to do that, as long as they're delivering the services efficiently and through some type of cost-sharing, then we feel that a company or a private sector provider may be able to do this very quickly, along the lines of Highway 7 or the 407.

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Mr Young: Thank you very much for an excellent presentation. It's really exciting to hear the optimism for change, the change the voters asked us to bring in on June 8.

I wonder if you could just expand a little bit on your new paradigm for delivering public services. Could you think of any examples where it exists now that could be expanded? I'll tell you where I'm coming from on that.

The mayor of Mississauga, Hazel McCallion, says they have private garbage pickup right now and it works fine, thank you very much. She also said she has no problem with the minister looking over her shoulder. She said the minister should look over their shoulders if they're screwing up. Can you comment on how this paradigm might work with additional services?

Mr Sharpe: Yes. Garbage is a very popular one. There has been quite a growth in garbage, and then you get into --

Mr Cooke: Is that garbage or garbage as garbage?

Mr Sharpe: No, garbage isn't really popular at all. The notion of private companies providing a service in a municipal context. Because of garbage and recycling and source separation, those sorts of things, there's been quite a demand for collection. Lately, because there wasn't entrenched public service provision of that -- in some cases there was some of that -- they brought in the dynamism of business, and it gave the municipality a balance. They had more than one provider. I think one of the biggest problems is the monopoly in so many of the services. There's only one provider there and you don't have a choice.

Mr Young: So choice would provide better service through competition and partnership.

Mr Cumming: It lets the local elected officials, councillors, for example, now have control of their municipal services.

Mr Hardeman: On the issue of local restructuring and restructuring the services, do you see Bill 26 taking us in that direction, that in fact we are providing the opportunity for municipalities to achieve the goals you're referring to, or do you see it requiring further refining to accomplish that task?

Mr Sharpe: I'm only a student of public administration, but I have read the bill, and to a large extent -- and I'm not a lawyer by any stretch -- it seems to me one of the main thrusts of the bill is: "Look, municipalities, here are the goals. We have to achieve this, and these are the reasons why," and they're giving them the tools to be able to do that. They're not saying, "You will do it this way," but they're saying: "If you don't do it, this problem is critical. We must do it and we're willing to act." That's a new approach. "Here's the ball. Run with it. But you've got to run with it."

Mr Hardeman: Further to that, you do feel it's important that after the local initiative has been exhausted, there is an opportunity or a way of dealing with implementing the final results?

Mr Sharpe: I want my kids to be able to live in this country somewhere near where I've been able to live, plain and simple.

The Chair: Thank you. We'll change over to the opposition side. Mr Crozier to start.

Mr Crozier: Thank you, gentlemen. It's an interesting, rather academic paper that you've presented to us today. You mentioned that you had read the act, so I'd like your comments on a particular aspect of it vis-à-vis restructuring municipally or at least doing things differently with the municipalities, and yet the power that the Minister of Municipal Affairs retains. Are you familiar with the Ontario municipal support grants that what they're doing is essentially giving the municipalities an envelope of money?

Mr Sharpe: So-called block funding.

Mr Crozier: Block funding. There we go. So you understand the concept of block funding. Yet where I see a power given to the minister: "We'll let you do this, we'll give this money to you, municipality, but if you don't spend it in the right way, according to the minister" -- which will be apparently determined by regulation -- "why then we can do a variety of things. We can reduce your funding. We can even make you pay some of it back." On one hand, we're getting governing to the local level and the decision-making to the local level, but -- what do you think of the "but"?

Mr Sharpe: I think it's a necessary part of it. In our Constitution, as an example, there are the federal and provincial governments, and the provincial government has responsibility for municipal affairs -- not necessarily the name of the department, but for things that municipalities do. It's all within the legislation; it's permissive-type legislation. They are collecting the taxes. We have an elected body in the Legislature that has to look at the demands that the people are making collectively in terms of funding and how much tax they want to pay, and we're getting a strong sense there that we don't want taxes raised. Similarly, at the local level the local politicians have to deal with that, particularly in the area of property tax.

I think it's two areas that need to work together, but at some point someone has to be accountable for this, and through our Constitution it's the provincial government. So I don't see a problem with them saying, "Here, we'll give you as much creative room as you need, but you must achieve this." I don't have a problem with that.

Mr Crozier: I appreciate that. I agree, through the Constitution it is the province, but then there is the Ontario Municipal Act. Some would suggest in fact that rather than having these types of piecemeal changes to the Municipal Act, the government should follow though on its promise to rewrite the Municipal Act. But when you talk about accountability, if the money's being spent locally, then I would suggest that the accountability should be local. But instead the minister is saying to municipal councils, "Notwithstanding your local contact, you're elected locally, you're accountable locally, if you don't do it the way I think you should do it" -- and I'm getting at the power of one individual -- "then, I'm sorry, but you may have to pay some of that money back." That's, I suspect, where we --

Mr Cumming: Under Bill 26, if the legislation allows municipalities to implement new models and paradigms such as we've presented this afternoon, then what you're saying is that the minister shouldn't have to go to those extremes. Under the current structure, whether it's transit, firefighting or whatever, ambulance service, everything is seniority structured, and this is one area, when the cuts come through, if there's not a new idea in place for them to look at, or they haven't got the power to implement it, then we lay off the bottom.

I'm here today also for the new idea, but there's a majority of the younger members on these departments who, because it's a structure the way it is in seniority, get laid off. Some of them don't even qualify for unemployment insurance. If we force them out the door, they go to the upper levels of government, whether it's unemployment or welfare. It defeats the whole philosophy of trying to reduce the debts. There's a system here, especially an emergency system, emergency services. Who runs the flights of stairs? It's not the guys who are a year or two from retirement. The customer would like that young guy coming in.

Mr Phillips: If I interpret the brief properly, this is sort of adjusting creative new solutions too. The minister has indicated that the bill does permit turning the firefighting over to a private company. I think he confirmed that the bill gives the mayors the powers to charge for firefighting and police. I think the minister said firefighting has been privatized in many US cities and he expects some changes along those lines. I gather you're saying that as you look at it, you think it's a pretty good idea to look at perhaps a private firefighting company.

Mr Cumming: Or a partnership with a business group of some sort. I don't agree with user fees; this is a service that I don't believe demands user fees.

Mr Phillips: The bill does suggest, and at least one mayor has said, that if your car catches on fire and you're not from that municipality, you're going to pay to put the thing out. You have a little difficulty with --

Mr Sharpe: That is currently the case, though. If a department services a car on the provincial highway, they can go back to the province and get some money.

Mr Phillips: I'm just saying that Mayor Lastman I think has indicated that as soon as this bill passes, he probably will put a fee on. If you're from Mississauga and your car catches on fire in his area, you'll be charged for that. That's a pretty good idea in your mind, is it?

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Mr Sharpe: That's not the side we were addressing here. We were addressing the cost side. We want to develop a new web of interrelated -- so that people, when they have an emergency problem, get the best-directed service appropriate to their needs and not a lot of overlap. That's really what we're looking at.

One example: The province, in terms of its highway snowplowing budget, has hired some private contractors and some of their own. They get to compare costs and they still have the security of having a force of their own. We believe that government stability can be accomplished there through a partnership and linkage with other providers, not necessarily for the whole thing at all. In some cases it may be only one part of the service, as we do now; Bell Canada supplies the communication to us in the first place.

The Chair: Let's move along now.

Mr Cooke: I noticed just now, and also in your brief, you refer to the connection to emergency services being through a privately operated company. I'd just obviously remind you that we're talking about a privately operated -- yes, publicly regulated, but a monopoly, so I'm not sure that that's the best example of success in the private sector. I would dare say that there are a lot of people in the country who are not thrilled with the way that particular monopoly has provided service over the years.

I have difficulty understanding when a few people -- there haven't been many, but when a few people come before the committee and talk about how this bill will result in restructuring in the way that we deliver services when I don't see a lot of that in the bill at all. I see new mechanisms for municipalities to raise taxes, and new taxes. That doesn't impose restructuring. In fact, it could result in avoidance of restructuring by developing new mechanisms for revenue.

Then I look at areas of municipal restructuring. We've already got the ability to restructure municipalities. The reason that hasn't happened is because local politicians don't like to do that. So what do we do? We've got regional governments, we've got local governments -- we've got about 800 municipal governments in the province. We've got the Ministry of Municipal Affairs, we've got regional offices of the Ministry of Municipal Affairs, and now we're going to set up a new bureaucratic organization called a commission that will look at restructuring local government. I dare say that each one of those commissions that will be set up will cost hundreds of thousands, if not millions, of dollars of taxpayers' money, and that'll go on the property tax base.

In health care, we've already got district health councils at the local level, we've got hospital boards, we've got agency boards, we've got the ministry, we've got regional offices of the ministry, we've got regulations. Now what are we going to do? We're going to have a commission set up to look at each community and close hospitals -- another big bureaucracy. You could go through every part of this bill and I think you could make a pretty good case that this isn't something that's tearing down bureaucracy; this is a bill that's putting in place new bureaucracy to try to put changes at arm's length for the government and give them a political cover. I dare say, at the end of the whole process we might have fewer services but we're not going to have more efficient or new ways of delivering service.

I'd like to get an understanding. Since you've gone through the bill in detail, where is the restructuring in the bill?

Mr Cumming: It's ideas brought forward by individuals such as Dave and myself. I imagine with the cameras on here this afternoon the news of our being here will be home before we are. You can appreciate how, working on a unionized workforce, they're resistant to ideas like this. But in all fairness to all government levels, until a new model is brought in, the only alternative they have is layoffs to save money, to resist increasing taxes. It lets people put all these creative user fees in there. I think there's enough room and efficiencies in these little budgets to get around all that.

Mr Cooke: I understand the concept of privatization; that's been around for a long time, that's not new. I have a concern with privatization of some of the essential services that you're talking about, like fire, and the lack of accountability that exists when you start having services that cover too big a region and a variety of different councils. Then the taxpayers say, "Who do I hold accountable for the delivery of that service when it's involving five or six different regions or municipalities?" In politics, accountability of the elected officials to the taxpayers and the voters is pretty essential.

Mr Sharpe: That's why this can be addressed so well through what we're suggesting. The local council can exist, they can decide what level of service they want and then they have an alternative approach, rather than just simply, "What have they got next door?" Maybe they need something different than that.

In terms of things like communications and that, when you get into larger areas, if you have one person answering a telephone for each municipality, when there gets to be a large disaster in one area that one person could be overwhelmed. If you can electronically move your people around -- in other words, have a group of people answering phones for a large area -- when a small area has a problem you can virtually move these people in -- not physically of course, but electronically.

Mr Cooke: Yes, but there's nothing under the current laws that prevents any of that from happening. I'm wondering, why your enthusiastic support for Bill 26 when it doesn't do anything to facilitate what you're suggesting?

Mr Sharpe: We feel that it does from the point of view that --

Mr Cooke: Tell me how.

Mr Sharpe: Yes. It's very clearly mandated that a person, an accountable person, the minister of, in whatever case it is, wants to achieve certain goals that are sorted out through the government, through the elected officials, and then from that point on the municipalities are told: "Here, run with it. This is what we want to achieve." It may just be cost-cutting at this point, because people are happy with a lot of the services, but the point is, I think it's a signal --

Mr Cooke: Show me where that is in the bill.

Mr Sharpe: Where it is in the bill is the municipalities have the first chance to solve their problems, but there's a major incentive there to do it and do it quickly to solve the deficit problem. It signals to me a distinct desire by this government to move in that direction. It's giving the impact or the motivation to do that. I agree, in a lot of cases it's already there, but the motivation hasn't been, and this is what I think Bill 26 signals.

The Chair: Thank you, gentlemen. You've come to the end of your half-hour. I'd like to thank you for coming forward to appear before the committee today.

We now have two empty spots, so we're going to have a one-hour recess. Before we leave, I would like to note and congratulate the researcher and clerk on how quickly they were able to obtain the privacy commissioner's order on frivolous and vexatious requests. I believe a copy has been provided for each caucus.

They've also made an overture to the Minister of Labour's office to see if there are indeed minutes of her speech. They found out the date of the speech a presenter talked about yesterday and they are undertaking to see if there is a copy of that speech available.

Mr Cooke: We're waiting for whether she's going to appear. Any word on the legal opinion from the ministry?

The Chair: That's supposed to be here by the end of this week, I believe.

Mr Hardeman: The legal opinion I believe will be ready tomorrow morning.

The Chair: Thank you very much. We'll recess for one hour.

The subcommittee recessed from 1428 to 1530.

DUNCAN MACDONELL

The Chair: Good afternoon. Could I have Mr Duncan MacDonell come forward, please.

Good afternoon and welcome to the standing committee on general government. You'll have 30 minutes today to make your presentation. You can do as you see fit with that 30 minutes, but you may wish to leave some time for questions and responses from the three caucuses. I'd appreciate it if you yourself would read your name into the record for the benefit of the committee members and for Hansard. You're perhaps representing yourself as a private citizen, that's fine, but if you are representing an organization, could you read that into the record too?

Mr Duncan MacDonell: My name is Duncan MacDonell and I am in fact representing myself as a private citizen. I think I might be a bit of an anomaly.

What I wanted to do today is talk about the diminished role of judges in the arbitration process. I was a little bit upset about that. But about a half-hour ago I was reading yesterday's copy or this morning's copy of the Toronto Star and I saw the headline saying something like "people are asked to submit written requests to make presentations to this committee because of time constraints," and it occurred to me that I'm probably one of the lucky ones who gets to sit here in front of you and speak to you.

I'd like to submit, first of all, this to the records. I'm not going to pretend to be a compelling speaker. I'm just a desktop publisher from George Brown. I think what's concerned me is that -- well, let me tell you a little bit about myself.

My name is Duncan MacDonell. I'm from Kenora, Ontario, which is up north and I've lived in Toronto for the last five years. I've studied at the University of Toronto for four and I'm finishing a year at George Brown in desktop publishing, so I'm pretty confident I'm going to get a decent job and the economy will be a wonderful place for me.

But what I'm concerned about is -- I guess it started the day I found out about Bill 26. It was the day after Eves's mini-budget. I heard about it on Metro Morning. What struck me was this perception of -- I don't know the right word to use -- I guess arrogance on the part -- and it's not a personal diss to any of you because I'm sure your hearts are in the right place, but there's a general perception of arrogance and being out of touch around the 20-somethings here in Toronto, and I'm pretty concerned about that.

What I'd like to do is put on record maybe some advice or some concerns that I have about how Bill 26 was handled and some genuine and in-good-faith suggestions on how, when something like this comes about in the future, the same mistakes won't be made again.

I guess all it really is -- I'd love to speak more, but I don't want to take any more of your time. I'm pretty unhappy with the speed at which this was introduced, the amount of time that we had to consider it and I feel almost as though I don't have a voice here and until about a month ago I did. So I think I might be speaking on behalf of a lot of people. We're starting to feel a little bit alienated about all this and we're starting to get very concerned about being left out in the decision-making process here.

Really, I think that's all I have to say because I'm talking off the top of my head. I was going to make a formal presentation about something really boring that you're probably going to hear about later, but I guess this is from the heart, so take it as it is. Do you have any questions?

The Chair: Would you care to read your submission?

Mr MacDonell: Sure. In retrospect, it's kind of irrelevant to what I was just talking about, but I will read it for the records.

To the committee responsible for the Bill 26 public hearings:

The following appear in sections 1, 2, 3, 4 and 5 of schedule Q: Amendments to various statutes with regard to interest arbitration and will be brought into force on the day the Savings and Restructuring Act, 1995, receives royal assent:

"In making a decision or award, the board of arbitration shall consider the following criteria:

"1. The employer's ability to pay in light of its fiscal situation.

"2. The extent to which services may have to be reduced, if the current funding levels are not increased.

"3. The economic situation in Ontario and in the municipality."

These three criteria should be dropped from where they appear in Bill 26 in schedule Q for these two reasons:

First, these criteria undermine our faith in the provincial government. The focus of the present provincial government is dangerously money-centric -- just as an aside, I don't know the proper terminology for this, but I hope the meaning's clear. Okay, back to the piece -- and the principles that guide elected officials shouldn't have such a bearing on a system that has been evolving in earnest since the early 1960s.

What the addition of these criteria say to me is that my government worries less about the obligations of the employer and more about making further cuts. For instance, if a librarian was qualified to be paid a level 5 salary based on the responsibilities she or he had but only earned a level 4 salary and so took her or his case to arbitration, it is very possible that the salary she or he is entitled to won't be granted due to a budget cut. This undermines all the rights that public sector workers have earned over the years.

Second, this legislation weakens our collective confidence in the arbitration process. If an arbitrator is obliged to submit to the whims and beliefs of the provincial government's Ministry of Finance, then of course she or he will have less autonomy from government and the decision handed down will not be taken as seriously. As a result, the power of the arbitrator is weakened.

Unless undermining the authority of arbitrators in order to navigate around hard-fought workers' rights in the name of budget cuts is the explicit intention of this government, I request that these three proposed criteria be dropped.

Sincerely, Duncan MacDonell.

The Chair: We've got about six minutes for each caucus to ask questions and we'll start off with the opposition caucus.

Mr Crozier: Thank you, Mr MacDonell. There's no reason at all that you should in any way feel you shouldn't be before this committee or that your presentation will be regarded any less than any other, at least by ourselves, because I think you represent, by far, the majority of Ontarians in that we are individuals. We've had some presenters who have been very sophisticated, but didn't understand the bill. So at least you're expressing your own feelings, and it's interesting to me that you should use librarians as an example because I have a daughter who has her master's in library and information science and can't get a full-time job in this province. She's one of what we estimate to be 25% of the youth or young unemployed in the province.

A lot has been said around the table about costs, about our debt and deficit, and I don't think there's anybody in the Legislature, outside it and for the most part in the province, who isn't concerned about that. I think what you do see around this table is a difference of opinion on how we go about it.

You've also mentioned about the arbitration method. This would insinuate, since it's being put in here that "the employer's ability to pay in light of its fiscal situation" -- it's been put in here as though arbitrators in the past totally disregarded that, which you may or may not agree with. I don't happen to think so. I think any arbitrator worth his salt probably would take that into consideration.

Not only the three that you've mentioned, but I'd like your opinion with regard to -- and I think it's in each one -- number 5, which is "the employer's need for qualified employees." Where that bothers me, and I'd like your opinion, is that there may be professional services, like firefighters, teachers, hospital workers or in the public service, where an arbitrator, in their decision, may feel they don't need certain qualifications, yet you and I, as regular citizens, may think so. That's another one I'd like you to consider adding to your list: How do you feel about the arbitrator being able to take into consideration the fact of the qualification of the employee?

Mr MacDonell: Pardon the pun, but it's arbitrary when someone has to determine how many people are necessary for a certain role in the public sector: firefighters, police, librarians, teachers. I would like to have included it all in this, but I think there were five, I believe. The first three, however, were pretty closely related, in my opinion. Like I said before, I'm just a regular guy and I don't want to put too much time and effort into going through the legalese of them seeing what the perceived needs in the population are.

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But what does concern me is -- and this is just from personal experience and my friends and people I know who've been affected by changes in the government in the last few months -- there's a general feeling of not being included in the decision-making process right now. I say again, I am a bit of an anomaly that I get to speak to you instead of write a letter, but I think so many of us do feel left out of the decision-making process. We don't have a lot of confidence in the government to decide how many firefighters is safe, if that helps, but I don't think I should include that in my presentation.

Mr Crozier: I wanted your comments. Thank you.

Mr Phillips: You have identified a part of the bill which, like most parts of the bill, represents very significant change. In fact, I was sufficiently suspicious of the bill that I turned to the back and worked from the back forward, because I figured that's where the government was trying to hide its biggest change.

I don't think there's any doubt that this is a fundamental change in the bargaining relationship between our firefighters and our police and our teachers and our hospital workers. It's a huge change. The government may want to proceed with it, and based on the comments we've heard, I'm sure that right now they're absolutely dedicated to it. I assure you that this takes away a huge part of the bargaining rights of those individuals. There is no doubt about that. It inserts language for the arbitrators that exists nowhere else. It just doesn't exist. One of my colleagues from the Conservative Party the other day, I thought, said that this language is encoded somewhere else. I specifically asked the Labour ministry staff to send me the language. They originally, in their briefing to us, said, "This language exists in Alberta, it exists in many provinces."

I thank you for pointing out a big part of the bill and for identifying what I think is going to be an area of some considerable controversy.

Mr Cooke: Thank you for appearing before us. When you said you listened to Metro Morning, then I knew you were just an ordinary guy.

Instead of talking about the amendments with respect to interest arbitration, because I think you've made yourself quite clear and we share some of those concerns, I'd rather focus a little bit more on your feeling of being left out of the process. I think that has become a very symbolic part of this government.

Let me put to you the argument that they used to us, and that was that on June 6, they won the election --

Mr Hardeman: June 8.

Mr Cooke: June 8. How soon we forget. I'm trying to forget. So far I've only missed it by two days. I'd like to forget it a lot more than that.

Their argument is that they got 45% of the vote, they won 82 seats out of 130, and democracy in a parliamentary system only exists once every five years. They've got a mandate to do what they're doing and that's it. There wouldn't even be public hearings on this bill if it wasn't for some pretty extraordinary activity in the Legislature a few weeks ago.

I'd just like to get your reaction. They do have a majority. They've got a mandate for something. I don't think they've got a mandate for all of this, but they've got a mandate for something.

Mr MacDonell: I'm glad you brought up the fact that I wouldn't be here unless it was the party that's not in power working tooth and nail to give us a chance to speak. I completely appreciate that.

Mr Cooke: Parties.

Mr MacDonell: Parties. I'm completely sorry. It was good to see the two of you working together, though. I'd like to see more government working together.

The symbolism of it all is very important. When the new government was first elected, I was cautiously supportive. I thought maybe they'll stick with their guns. I guess they have. They represent all 18 Toronto belt ridings and the most middle class, privileged, vindictive and probably overtaxed segment of the population. For the next five years they are going to represent them. They're going to represent the people with the largest voice.

I don't have a big voice. I live downtown. I go to school. The underprivileged don't have a big voice. I think that for the next five years this sense of alienation is going to grow, because I don't think they represent me. As to the whole idea of a mandate, the 45% that voted for this new government, they're not me and they don't come from where I come from; they come from a completely different way of looking at things. Unless there's some huge effort made on the part of the government right now, I don't see myself being able to get involved and feel like I'm taking part in the process of democracy. I'd much rather pack my bags and move to BC. The weather's nicer, the tuna's cheaper. I guess that's all I have to say.

Mr Cooke: In terms of processes government should use to keep people involved and to have that ongoing democracy, what should this government, or quite frankly, any government, do to involve its citizens on a more ongoing basis? The hearings are important, but you know as well as I do that the hearings are the very last stage. Once a government's brought a bill into the House and it's been passed for second reading, it's got to defend that bill.

Mr MacDonell: I guess there are two places to start. One, you can start symbolically. You can take the fortress and chain-mail out from around the Legislature. That would be a great start and make me feel a lot more welcome here. But actively going out and knocking on doors and slowing down -- sure, it's a Common Sense Revolution, but slow down. Let us all have some time to digest what's happening, what's going on.

What really struck me about Bill 26 when it was introduced was that it was introduced -- was it the day before or the day after the mini-budget came out?

Mr Cooke: The day of.

Mr MacDonell: Nobody noticed because everything was going on at once. Photo-radar was taken off the roads because -- it wasn't decided on in the House. My impression is the police were instructed not to bring their cars on the highway. Everything is happening far too quickly for the rest of us Hobokens to get a grip on. I am feeling completely out of the loop. I feel like I'm a month behind the times and I really would like to have a voice here. Maybe extending the hearings for another month.

Mr Cooke: I appreciate your coming forward. I think you've expressed certainly a feeling that I'm getting from a lot of people in my own constituency and also in correspondence, but you've done it better than we can do it as politicians. Thanks for being before us this afternoon.

Mr Tascona: Mr MacDonell, I'd just like to ask you, are you aware that we've given this legislation more committee time than any legislation in the last two parliaments?

Mr MacDonell: That's a great question. Let me get going on that one.

Mr Tascona: But are you aware of that?

Mr MacDonell: Even if we are giving so much to this legislation, there's still a waiting list to speak to you. You're asking people to write letters to you. I think the reason that so much consideration is being given to this legislation is that it is so mind-numbingly sweeping. It's everywhere. It sets the stage for the agenda for the next five years. We have to sit down and think about it.

Mr Tascona: But you are aware that we've opened the process to the public to make submissions, and obviously the public is aware because they're doing that and they want to come forward.

Mr MacDonell: Yes, and I encourage you to bring the public forward, to go door to door. I don't think the government in power should take credit for my being here right now. That would be a huge mistake.

Mr Tascona: We're not trying to take credit, but you do know every riding has an MPP office and certainly anyone can go there. I know in my own riding we have a copy of the act and we have people there to talk to them about it. I think that's democracy in itself.

Mr MacDonell: I think so, and I think the MPPs should actively encourage their constituents to come and seek them out; don't wait for the constituents to seek them out first.

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Mr Tascona: I want to deal with a couple of your submissions with respect to interest arbitration. I just wanted to assure you that you're dealing with the qualified librarian. That's a form of arbitration which is called rights arbitration where you have a grievance under a collective agreement. We're not affecting, by Bill 26, anything to do with rights arbitration. What we're dealing with is interest arbitration where we're dealing with a collective agreement in itself.

Mr MacDonell: That's the interpretation of the contract?

Mr Tascona: No, not the interpretation of the contract, but dealing with settling such issues as wages and areas that have been subject to negotiation between the parties, not the interpretation of the contract, which would be subject to rights arbitration. We're not going to affect that. Bill 26 deals with interest arbitration.

I'd like you to know this, and I take notice of my friend from the Liberal Party, in terms of mandatory criterion. It is a fact that other provinces and the federal government have mandatory criterion for interest arbitration. It's also a fact that ability to pay can be considered as a relevant factor by a board of arbitration.

But I'd like to ask you this: I take it you favour a form of mandatory criterion because you didn't exclude all the five factors, you just took out three. What concerns me, and I'd like to get your comments on this, is the ability-to-pay factor. We're dealing with a situation where obviously we have, as a provincial government, a critical deficit situation. Our transfer partners are going to be receiving decreased transfer payments. I'd like to ask you, how can it be unreasonable to ask arbitrators to consider an employer's ability to pay when setting contract awards?

Mr MacDonell: All right. For starters, you're mistaken in assuming that my silence implies consent. I may very well be in opposition to the two criteria that I didn't include on this list.

Mr Tascona: You can tell me right now.

Mr MacDonell: I don't want to include them. I want to keep focused.

I think what's important, perhaps, would be the perception, the rights of the public sector workers over the coffers of the government. It's not up to me to tell you how to balance the budget, and I know that's very important to the 45% of Ontarians who voted, and now it's around 60%. I give you full credit. There are a lot of people who support you. The approval rating, I don't know; it's some poll thing.

Mr Tascona: But don't you think, Duncan, that the public interest should be taken into consideration also in terms of the ability to pay, to avoid tax increases, to ensure that reductions in service levels don't occur from an arbitrator who basically says, "I'm going to increase the wages," and does that in the face of fiscal restraints?

Mr MacDonell: It makes perfect sense. On the same note, though, I think that if the librarian who is doing the work of a level 5 librarian instead of level 4 -- don't ask me what that means -- goes and wins an arbitration case, and in my understanding most cases that go to arbitration come in favour of the --

Mr Tascona: That's rights arbitration. We're talking about interest arbitration where we're dealing about a collective agreement that is being negotiated. We're dealing with a situation where wages are a main issue and we have to deal with the fiscal reality of the situation, which is that employers in this day and age can't pay what an arbitrator says they should be paid because there are limits.

Mr MacDonell: So because they don't have enough money to pay what it is the workers' rights to get for what they do, they're not obliged to pay them under this legislation.

Mr Tascona: If they have to get the money, they may have to go out and tax or they have to reduce service levels. Don't you think it's better that they don't increase taxes or reduce service levels and maintain individuals in their jobs, so we can have an efficient operation in a fiscally responsible manner?

Mr MacDonell: No, I don't.

Mr Tascona: You wouldn't agree with that.

Mr MacDonell: I disagree with that.

Mr Tascona: Okay, I understand.

The Chair: Thank you, Mr MacDonell, for appearing before the committee today. We appreciate it.

CANADIAN FEDERATION OF INDEPENDENT BUSINESS

The Chair: Could representatives from the Canadian Federation of Independent Business please come forward. Good afternoon and welcome to the standing committee on general government. You have half an hour to make your presentation today. You can use that half-hour as you see fit. You may choose to leave some time at the end of your presentation for response and questions. I'd appreciate it if you'd read your names and your organization into the record for the benefit of both Hansard and the committee.

Ms Catherine Swift: My name is Catherine Swift. I'm the president of the Canadian Federation of Independent Business. My colleague Judith Andrew is with me today. She is the director of provincial policy with special responsibility for Ontario.

We had packages, which I hope you just got, including our statement today, as well as some background material, notably one on the whole area of property taxation that we had completed actually quite recently.

We're going to probably talk for about 10 minutes or so and hopefully leave the rest of the time open for questions.

As you may know, the CFIB is a non-partisan political action organization which represents currently about 40,000 small and medium-sized firms in Ontario, and about 87,000 across Canada. All of our members are Canadian-owned companies and owner-operated, as well as independently held, not publicly listed companies.

We very much form our policy positions on any given issues on the basis of input from our membership. We found, as we went through the omnibus bill, that at this time we have member direction already on a number of key elements of this particular piece of legislation. Naturally, we haven't yet had the opportunity to survey on some of the areas where we may not have already had member information, so our comments today are not comprehensive necessarily, but they do focus on our priority areas with the bill, and on which we already had significant direction from our members as to which way we were going.

Overall, small businesses in Ontario have been very much supportive of quick and decisive action by governments in many areas to start to correct some of the problems that have been created by the tax-and-spend approach we've seen governments take in this province over at least the last 10 years and probably longer.

We do ongoing surveying of our members and one of the most recent surveys we did on general member priorities showed that we saw concern among small businesses over the overall level of the debt and the deficit was at a record high. It happened to be just over 84%, and this has increased quite dramatically over the past few years in this province. It was the second most important issue prioritized by our members, just after the issue of total tax burden which is the perennial number one on our surveys, possibly not surprisingly.

We've heard a lot of public opposition of course to this bill, not unexpectedly, I guess, but we don't find that our membership seems to have a great deal of problem at the moment about the scope of the bill and the rapidity of the bill's introduction. We've always found in our organization -- we've been around almost 25 years now -- that if our members particularly have a problem with something, sometimes even if they support it -- but as usual it's usually the complaints one hears -- we hear about that very quickly. We've found on this particular piece of legislation that we really haven't had an awful lot of feedback from our members. We'll of course be continuing to monitor that over the next little while to see how that proceeds.

Generally speaking, some of the overall objectives of Bill 26 are very much in sync with what our members have been recommending in Ontario for many years now, that of reducing the overall size and, of course, the cost of government, and hopefully increasing the efficiency.

Another survey we did earlier this year showed that in terms of the priority areas outlined by small firms for expenditure reduction -- there's a chart on page 2 of the brief that outlines some of the data here -- some of the key areas they felt were the most desirable targets for spending reduction included business assistance, social assistance and local government transfers. Areas in which small businesses supported lesser spending reductions, but nevertheless some spending reductions, included the environment and education, and we also found that a majority of our members favoured freezing spending in the area of health care, although we still had a quarter who thought some reductions there could be achieved.

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Getting into some of the specifics on the bill, we find that in the various amendments to the Municipal Act that are in schedule M, a lot of the direction here would have the support of small business on the basis of past surveying we have done. Certainly permitting municipalities more autonomy to make decisions at the local level is commendable, and our members do support the principle that the closest level of government accountability should certainly be improved and increased.

We also think that it's essential that the provincial government undertake measures to promote municipal restructuring and municipal consolidation, since, as we've seen in the past, this won't happen if it's exclusively left up to the municipalities, but it certainly is badly needed.

We don't believe that regional governments, as a result, should be excluded from the bill, since research we've done with our members on the particular issue of two-tiered local government suggests that our members overwhelmingly support the elimination of one level of local government. Indeed, we did a brief survey in late 1993 and we found our members were 73% in favour of the elimination of one tier in the case of two-tiered local governments.

As well, although our members have of course had quite varied experience with different municipalities over the years, we have generally found that municipal governments are often the worst offenders in terms of overspending and the related large increases in property taxes. We've done a lot of work on the property tax area as this issue has increased in importance among our members. Perhaps not surprisingly, at the local level, business taxation far exceeds residential taxation in all municipalities. We also find of course that variations among similar businesses are enormous and not based very frequently on any reasonable criteria. Small firms also are typically more exposed to property taxes and problems in the system than are larger corporations. So we find small firms are especially vulnerable to a lot of the inequities in the property tax system.

One of the things we have included is this study called Silent Killer, and I might just briefly refer you to a couple of charts in that. In the introduction, just after the executive summary, in figure 1, there's an international comparison of total property and wealth taxation, and this just situates Canada within the international context. As you can see, we are right off the scale compared to other jurisdictions, other developed countries and so on.

Then turning the page, a couple of pages actually, to figure 2, we can see that Ontario is very much a standout -- not a commendable standout, but nevertheless a standout -- as far as being the worst for property taxation in Canada. So Canada is the worst in the world; Ontario's the worst in the country -- not a very enviable record. And of course we have found a lot of problems particularly visited on the small business community as a result of these systems.

We've also done some work in the area of compensation and benefit levels between the private and the public sectors, as have other organizations whose research compares favourably to ours. We have found there as well that municipal governments are often particularly guilty of having salaries and wages for their employees that are much higher than for private sector workers in comparable occupations.

As a result, from the viewpoint of our membership, municipalities do not have a great track record, and giving these municipalities yet more powers to raise revenues is greeted with dismay by many small firms. Giving municipalities in particular access to direct taxation in addition to their existing ability to levy property taxes, business occupancy taxes, user charges and development fees is very questionable in the light of most municipalities' past inability to manage their finances effectively. We believe these parts of the bill should be seriously reconsidered.

Small firms very much support the notion of encouraging municipalities to pursue privatization, contracting out and franchising as a means of reducing costs. There has been quite a lot of evidence to suggest that significant cost savings and efficiency gains can be achieved by these kinds of measures. We've also found that over the past 10 to 15 years, many of our members have found their own businesses threatened by competition from public sector competitors, many of which have been found in the municipal domain. We feel that small firms that are paying taxes and then find their own business area intruded upon by a public sector competitor, who of course is being subsidized by those tax dollars, is pretty inexcusable from any standpoint at all.

Ms Judith Andrew: On the issue of user fees, I think from our surveys and the evidence we have, small businesses are generally supportive of a user-fee approach to public services, but that comes with two caveats. The first is that the service provided must be commensurate with the fee charged and, secondly, that the new fee and the revenue it raises has to also be accompanied by a comparable decrease in other areas of taxation. In other words, fee increases or new fees should be a replacement for other forms of taxation, not in addition to them.

All too often we've found that governments have effectively undertaken tax increases in the name of user fees, and very often those fees are out of proportion to the value of the service provided. A key example there was the corporate filing fee.

The small business community doesn't believe overall that there should be a need for significant increases in user fees or in property taxes at the municipal level as a result of the reductions in transfers proposed by the provincial government. As you could see from the study we've conducted, tax levels are already excessive and very punitive to small business. So we are very firmly of the view that there should not be any increase in either user fees or property taxes.

Small businesses themselves have faced economic conditions over the past several years which required them to lower their costs in order to remain in business. They feel that it's critical that municipal governments also look to the cost side of the equation and reduce their overall spending as opposed to looking to make up the transfer reductions in the way of fees or tax increases.

Given our members' experience with taxes and fees at the local level, it wasn't surprising to find in our 1995 property tax survey that only 19.4% of our members supported increasing or expanding user fees. That result is in the tax study, Silent Killer. It's page 21.

In terms of the position some other business groups have taken relative to expanding local governments' abilities to raise more revenue via user fees, we believe that their arguments that were based on the premise that current municipal fee-based revenues are underexploited and so forth are fallacious. If you look at the facts, the reason the proportional role of user fees is low has to do with the excessively high levels of property taxes in place in Ontario, not because the user fees are too low. We believe that if property taxes were more in line with other jurisdictions, the relative contribution of user fees versus the other sources of revenue in municipal finance would be substantially higher.

Our members also favour the gradual elimination of the use of variable mill rates, a subject that wasn't addressed in the bill. We think that assigning different mill rates to different types of property severely distorts the tax system and they cannot be assigned in any meaningfully objective way. It's our position that uniform rates are the fairest way to apply property taxes.

I'd like to turn now to the proposed general licensing powers of municipalities contained in the bill. We believe that these powers in Bill 26 are too sweeping in their scope and would permit too much opportunity for arbitrariness in the granting of licences to businesses. We believe that licensing requirements should be reasonable minimal requirements to prevent them from becoming a barrier to business. We're concerned about the ability of municipalities to impose special conditions on a single business that have not been imposed on other businesses in the same class, since this in effect would be discriminatory and arbitrary treatment of a particular business.

We also find worrisome the enabling legislation that would permit municipal governments to levy licence fees which may be in the nature of a tax, possibly for the sole purpose of raising revenue. Small businesses believe that licence fees should bear a direct relationship to the cost of the service being provided, and this should not simply be another means of raising revenue.

The schedule Q elements of the bill on interest arbitration are in line with CFIB's long recommendation that the ability to pay must be a central consideration to any determination of public sector compensation settlements. We conducted a survey after the 1995 provincial election. It was our post-election issues survey, a pot-pourri of issues, but this particular one in this area found that 83% of small business respondents favour replacing the right to strike in the public sector with a system of arbitration of settlements according to criteria which limit the amount of the settlements.

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We find the direction in the bill, however, to be too open-ended in that it doesn't preclude such things as increasing taxes as a means of enhancing ability to pay on the part of the employer. As well, the record shows that wage increases accorded by arbitrators have typically exceeded those arising from freely negotiated agreements. Accordingly, awards by arbitrators should not be permitted to exceed those that have been freely negotiated by other bargaining units of the employer within a similar time period. Just generally here, we think there should be more stringency in this entire area.

I'd like to turn also to schedule A of the bill. Small business supports the thrust of this section to promote disclosure of broader public sector compensation levels in excess of $100,000 per year. Studies conducted by ourselves and of course others have indicated that public sector salary and benefit levels on average exceed those in the private sector by a margin of 15% to 20%. Incidentally, we actually have our most recent study with us if the committee would wish it.

The benefits in the public sector, notably pension benefits, are typically much richer than those in the private sector and, of course, they're subsidized by taxpayer dollars. Overly generous public sector compensation levels are not only inequitable, but they represent a source of unfair competition to the private sector employment, especially in remote communities. Small businesses have often found themselves in the unenviable position of competing with the public sector for unrealistically well-compensated employees with their public sector employer competitors subsidized by businesses' own tax dollars. We believe the disclosure of public sector compensation would go some way towards exposing those inequities and applying some reasonable limits to compensation and benefit levels in the broader public sector.

Just generally to wrap up, we believe the objectives of Bill 26 to reduce the cost and increase the efficiency of government are necessary and they are commendable, although we believe that some changes must be made, as Catherine and I have both outlined. Small firms in Ontario have long been supportive of the thrust of the legislation and we believe that action on many of the items is long overdue. The comprehensiveness of the bill makes it difficult to provide detailed, informed comment on all of its elements but, on the other hand, the need for quick action is clear. The Canadian Federation of Independent Business remains available to provide any further input as necessary as this bill moves through the legislative process.

We would welcome your questions and will attempt to answer them.

Mr Cooke: Thanks for the presentation. I just have a couple of questions. Since one of the major aspects of this bill is the new powers that it gives to municipalities for taxing and licensing, which most people would say is a tax -- I think you've said that in the past -- if those sections of the bill remain and since the number one priority for your membership is taxation, would that change your view on the bill for third reading?

Ms Swift: It probably would, because I think what we see as governments at all levels push down spending responsibilities -- the federal government's doing it provincially, provinces are doing it municipally -- we see for our constituency in particular, given the problems with the small firm sector, it being particularly vulnerable at the municipal level from all the evidence we've ever seen, I think we see that as one of the key threats to small business in the future as governments sort of reorient their spending and what not. So if there weren't some modification, yes, I think we would have some pretty serious problems with that.

Mr Cooke: Mr Leach, when he appeared before the committee, said very clearly -- I don't have Hansard for that day in front of me, but he made it very clear that one of the reasons municipalities were being given this additional taxing power was to make up for the lost revenue that the province was cutting. I know you support the proposed income tax cut at the provincial level. Would you think it would be such a good deal if, on one hand, they're cutting transfer payments to municipalities at the level they are, cutting provincial income taxes for the sole purpose of allowing municipalities to raise taxes, so that in the end, since there's one taxpayer, the taxpayers of this province are going to be no further ahead?

Ms Swift: If that is indeed the case, that would be a problem. I don't know that it should be or would be. Obviously, it'll depend on the details of the tax reduction on the personal income tax side. Fundamentally, we see government, especially from a small business standpoint -- many small firms, probably most, have gone through hoops over the last 15 years adjusting to two very difficult recessions. They don't have the option of saying, "I'm going to up my prices" when a recession hits; they have to cut their costs.

We see no reason why the rules should be different for government. Government has never, until relatively recently, across this country taken that option. The whole notion that this automatically has to result in a tax or fee increase at the municipal level we don't buy for a second, and we have heard people in the provincial government saying the same thing.

Obviously, it needs very close monitoring. We do think the best way to give a boost to the economy is to put more money back into the people's hands who are going to create the wealth, both consumers and the job creators, small businesses. We don't buy this automatic relationship, that it will automatically have to mean an increase in taxes. It certainly isn't the case for a business community, and if we can do it, governments can too.

Mr Cooke: When you're comparing the property tax levels in this province with other provinces, I think it would be important for you to include the fact that this province relies more heavily on property taxes for the purpose of education funding than any other province in Canada. Part of the inequity or part of the distortion of the comparisons is because of an outdated method of funding education at the province.

Ms Swift: We do. Actually, if you read the report, those factors are included.

Ms Andrew: Our recommendation is to limit the use of property taxes to fund education, and that's contained in the Silent Killer report.

Mr Sampson: I want to follow up on this issue. I think the theme of Mr Cooke's question is the accountability and who pays for the services being provided. Is it your group's view that small business is better off if accountability for service delivery and the financing or funding of that is at the same level, at the municipal level, for instance, as opposed to being split?

Ms Swift: We actually have a relatively old member vote on that issue, which did indeed favour more local government accountability for both revenue-raising and service delivery. We would like to get a current read on that issue among our members because of course times have changed a lot. They have seen themselves hit very hard at the municipal level over the past five to 10 years in Ontario, by and large; obviously there are big differences among the municipalities, so we don't want to tar everybody with the same brush. Some have managed to contain expenditures, which we feel is just more proof that it can be done.

Although we do, as I say, have an old read on that, I think we're just a little wary of using that in the current context.

Mr Sampson: But it would seem to me that the small business community would feel far more comfortable holding accountable a local level of government than a provincial level of government, where the funding and the service delivery could be split between even levels as opposed to departments within the same level. It would seem to me that they would feel far more comfortable with that idea.

Ms Swift: There's probably some evidence to suggest that, but the problem at the moment is that you can support principles, but the way it ends up getting manifested in practice is often pretty punitive. Right now, not just small businesses but I think most Ontarians feel taxed to the limit. There's just no trust, no confidence that municipalities won't hose them just as much as other levels of government have, since they have in the past.

If you go to a more fee-based system, perhaps that's fine if there's a reasonable reflection of costs and so on, but continuing to up the ante overall is just not on. We're already over the top in the cost and tax area and we just don't think there's scope for many more increases.

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Mr Hardeman: You mentioned the issue of licensing and your concerns with licensing. Presently under the licensing structure for a municipal government it's fairly well defined to the extent that a bakery licence can be $1. In your submission you do not seem to indicate any objection to the licensing being set in such a way that it is a total cost recovery for the service being provided.

Ms Swift: That's true, if there's a reasonable reflection of costs. But experience has shown that things have not been, when it's been fees or whatever. We feel that if there's proper accounting and a reasonable reflection of what the service is costing, our members are very much in favour of that kind of system. It makes sense.

Mr Hardeman: The other issue you brought up was the issue of user fees, that when a new user fee is applied, it should reflect a decrease in the taxation. Would that apply to the fact that the municipalities are presently going to receive considerably less money from the province? Is it your submission that some of that could be made up with user fees or do you think they should find all that in other areas and that the user fees should offset total decreases in the municipal property tax?

Ms Andrew: We believe that if the municipalities are experiencing reductions in their transfers, they need to look within and find ways to cut their costs in order to absorb that. This is one level of government that really hasn't done very much in this area and we think that's where they should first look in order to absorb the reduced transfers. If they think a fee-based system is more appropriate to more closely charge the people who are using particular services, that's fine, but it shouldn't be an additional revenue source for them. They should be reducing taxes overall concomitant with the introduction of fees.

Mr Phillips: I appreciate the brief of CFIB. I have a lot of respect for your organization, as I think you know, and the advice it provides to the government.

Your brief is not unlike what we've heard from some other business groups; that is, you think you really like the bill, but when you get into the detail, you start to raise some significant concerns. I just want to raise two or three.

The board of trade advice to us was that the corporate tax act, which is schedule B, should be withdrawn. They said that now they've had a chance to look at it, there are economic implications which could be adverse for business. The board recommends that amendments to sections 1, 2, 3 and 5 of the Corporations Tax Act and the enactment of section 74.2 be withdrawn from the bill and covered by separate legislation.

Has the CFIB had an opportunity to look at that section of the bill? What advice do you have for us?

Ms Swift: We did. We saw the board of trade's submission, as well as looking at that part of the bill, and nothing leapt out at us immediately. In a perfect world one would want to have more time for just about everything, and I don't think this bill is really any exception in that regard.

Mr Phillips: So you don't share their concerns --

Ms Swift: I don't think we have the same concerns as the board of trade does on that item.

Mr Phillips: Okay, I appreciate that.

On the fees and the charges, Mayor McCallion told us the other day that she has a legal opinion indicating that a local sales tax is permissible under the bill, as is a local gas tax. She went on to say that she rather welcomed that, because the municipalities in the greater Metro Toronto area had looked at integrated transit, "and we discussed it, all the municipalities, and the only way we could do that was with a gasoline tax." She went on to indicate that she was quite pleased with the bill because now it would permit a gas tax and perhaps that would be the solution to integrated transit.

If indeed the bill does permit the introduction of a gas tax, would the CFIB find that acceptable or would you feel that that had to be amended to specifically exclude something like that?

Ms Swift: I heard that as well, that there was this legal opinion out there. That would be a problem for us for a number of reasons. For one thing, as far as sales tax goes, we have enough of a mess right now with two sales taxes in this province, and we feel adding a third would be supremely messy. We simply don't need any more inefficiency-introducing measures in our tax system than we've already got. We've already got plenty. The same would be extended to a gas tax. Again, I don't know the legalities and exactly how this will be resolved, but I very much believe that those should be excluded by whatever means from municipalities' purview.

Mr Phillips: The licensing portion of the bill also is quite sweeping, by design, I think. I think the intent of the bill is to give the municipalities unlimited flexibility, I think they called it. The licensing powers are quite sweeping, and there's even a section in here that says, "If there is a conflict between a provision in this part and a provision of any other section of this act or any other act, the section that is less restrictive of a local municipality's power prevails."

In other words, if there's any dispute around licensing, this act prevails over any other act. It does look like it gives quite sweeping powers to impose licensing that could even be -- the licence could be geared to the sales in the business or geared to something beyond just a fixed licence fee. If that were the case, would you feel the bill is acceptable?

Ms Swift: We spent some time on licensing in our brief, because the way we read it, we also felt it was too sweeping. One of our concerns that arose was that fairly precise arrangements could be required of, say, one business and not of other businesses that were in the same class of business and the same area etc. The arbitrariness was something we were concerned about in the licensing, and we did mention that at some length in our brief. Yes, we had a problem with the licensing.

Ms Andrew: In terms of the ability to turn a licence into a revenue-raising effort, we go on the same principle as the fees: It's got to be concomitant with the service received. A licence of $10,000, for example, would be completely unreasonable.

The Chair: I want to thank you on behalf of the committee for coming down this afternoon to make a presentation.

METRO TORONTO COALITION FOR BETTER CHILD CARE

The Chair: Could I please have some members from the Metro Toronto Coalition for Better Child Care come forward. Good afternoon and welcome to the committee. You have 30 minutes to make a presentation, which you can use as you see fit. You may decide to leave time for questions. Please read your name and organization into the record before you begin for the benefit of the members and Hansard.

Ms Katheryne Schulz: My name is Katheryne Schulz. I'm here on behalf of the Metro Toronto Coalition for Better Child Care. The Metro Toronto Coalition for Better Child Care represents a network of over 400 non-profit child care programs in Metro Toronto.

I would like to thank the committee for the opportunity to speak this afternoon and I would also like to commend the actions of the opposition parties in advocating for the right of citizens to make public their views regarding Bill 26.

Just to digress from my brief for a moment, I'd like to ask for the committee's indulgence if I seem a little distracted. In fact, before I came here this afternoon, I got a call from my partner at work, who told me that our informal caregiver was not at home when my eight-year-old arrived home from school, so she ended up being in the house by herself. Fortunately, my partner was able to leave work early and go home to be with my child. But of course if I were a single parent I would not be appearing this afternoon as a result of this.

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This bill that we're addressing will directly impact families and children in Metro Toronto. I want to make three points, because I know that you've already heard from the Ontario Coalition for Better Child Care on this bill, and there are some things that we have to say that are similar. I want to take you through the impact of this bill on Metro specifically. I also want to talk about an application that Metro has made through strategic initiatives with the federal government, so I will be going over that as well.

As you know, there have been a number of cuts to child care since the July 21 economic statement, and we outline those in our brief. I'm sure you're familiar with them already. One of the key issues in terms of the Metro region is the 47% cut to municipalities which is contained in the bill.

For those of you who are not familiar with the services that Metro provides, Metro administers 54 directly operated programs, 22,000 subsidies and 27,000 spaces overall to Metro's families. Currently there are 25,000 families who are eligible for child care but are on the waiting list to get care. My family is one of those. A child care subsidy for those families would enable them to go to work, essentially. A lot of people are waiting for child care subsidies to go to work, to engage in retraining or to go back to school to upgrade their skills.

For people who are not also aware that parent fees make up a substantial portion of child care funding in Metro, I'd just like to point out that fact: 5,000 spaces in Metro's child care system are full-fee, and Metro's subsidized parents pay over $19.1 million in user fees. That's a significant contribution.

Metro is the largest supplier of child care in the province, because the municipality has recognized the economic benefits of child care, and it's been quite supportive in ensuring that as much regulated, high-quality child care as possible is available to families.

In addition, Metro has implemented a task force on services to young children and families. It's a political steering committee which is examining ways for governments to work together to serve children. The task force was partly implemented because of the provincial picture at this point. People are realizing that reorganization is going to have to take place if Metro's families are going to continue to be served.

At the same time, however, Metro is undertaking a priority-setting exercise to determine which services it will continue to fund. What the children's services department has been asked to do is to provide a 25% reduction scenario for child care. This would mean a loss of 8,621 child care spaces, not including Jobs Ontario child care spaces in Metro, which are currently slated to wind up as of December 31. That's about 3,580 spaces as well. Given that there are 22,000 subsidies, the total number of subsidies at risk represent half of the child care subsidies in Metro.

Another point to also realize as well is that because there are so many employers in Metro, these subsidies and these spaces don't necessarily just serve families within Metro. In some cases, people are trying to put their child care close to their work, so in some cases that's also a factor. So they serve beyond Metro.

This bill and these cuts, as I said, mean a loss of about 8,000 child care spaces. Again, this is not the first instance. I know that one of the questions that was raised previously with the Ontario Coalition for Better Child Care was, if municipalities support child care, they'll make it a priority and therefore continue to fund it. In fact, Metro has always made child care a priority, or it's tried to protect child care services, but they haven't managed to do it, particularly with regard to Jobs Ontario. So we're not hopeful about the future of some of the subsidies in the regular system.

In 1996, Metro could lose almost half of its subsidized system -- that's the total, 11,000 -- and there is no doubt that child care in Metro will be devastated. A cut of 47% to municipalities will force even supportive local governments to amputate child care services. Bill 26 includes the municipal support program, which provides for municipal flexibility in the delivery of programs. When the cuts are coupled with the municipal support program, there is additional cause for concern.

The additional cause for concern refers to one of the working documents of this government, which outlines a proposal to scrap the subsidy system and replace it with a targeted voucher system. That, coupled with the review that's been announced, is a cause for serious concern because we're worried that the province will give municipalities like Metro the option to replace regulated child care with low-cost vouchers. I have a copy of the document for those who are not familiar with it. The end result of this is that you will see a situation where regulated quality child care is replaced with unregulated child care, which is not the most reliable form of child care, as my situation this afternoon demonstrates.

I'd like just to move on to this issue of federal funding. In response to the provincial picture, and I think you have this in front of you, Metro Chair Alan Tonks wrote a letter to the federal government applying for assistance under the strategic initiatives program, which is a program that was set up for people who could apply to find innovative new ways of providing social services in an atmosphere of economic restraint.

Does everyone have this? It should have been handed out to you as an appendix.

The Chair: Yes, we do have that.

Ms Schulz: What I want to make clear to the committee today is that it's my understanding at this point that the federal government is prepared to go ahead with this proposal. It doesn't require any provincial contribution at all. It will bring about $36 million to Metro. What's basically barring this agreement from happening -- because we have agreement at Metro and we have it from the federal government -- from going ahead, is the provincial government saying that it's fine with them.

That's a lot of money. As I said, it could save child care services in Metro Toronto. It will certainly lead to improved efficiency and better services.

So my question to the committee today is whether members of the government are willing to go ahead with this proposal and okay it so that families in Metro aren't in the kind of panic situation we're all in now with the cuts looming here.

I think that's basically the end of my comments. Are there any questions?

The Chair: We'll have six minutes per caucus for questions. We'll start off with the government caucus.

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Mrs Janet Ecker (Durham West): Thank you very much for coming today. I think your concern about quality child care is quite evident, and that is indeed why the province is undertaking a child care review, because there is no intention on the part of this government to replace good quality care with bad quality day care.

There are two points that I think are important to get on the record here, because you are, if I may say with all due respect, in error.

There is no government policy document which says we are going to dismantle the system. There have been no decisions made. The government is reviewing the child care policy. That is not the policy of the government and I know that the coalition has been advised of that. I am very unhappy that many of the parents are continually being told that this is indeed the policy and that it's happening next week or next month or tomorrow or whatever, and it's causing a great deal of concern within the community which I think is not justified.

We are reviewing the system, as I said, and the reason we need to review the system is because we have to make sure that the resources -- we're spending up to $549 million in child care in Ontario -- are dedicated to those most in need, that they're going to support parental choice. We believe that we need good quality day care and we also believe that we need to balance the private versus the non-profit sector and not do what has happened previously, where there was $50 million spent to convert from private sector to non-profit sector day care without creating one additional child care space, which I think you will agree, given the need for child care spaces, was not an appropriate use of taxpayers' money.

The second issue that I think is important to raise is Mr Axworthy's so-called offer to the provinces. I really do wish it were that simple, that we just had to sign up and receive money, but unfortunately, despite repeated attempts of Mr Axworthy, we do not have details as to what is going to happen with this money, where it's coming from, what it's coming for. Given the fact that they're already taking $2 billion out of transfer payments to Ontario, the claim that this is new money I think is a little facetious. We are quite interested in working with Mr Axworthy. We're hoping to meet with him in the new year to discuss how we can work together to preserve good child care, as we've met with Metro to do the same thing.

I did think it was important to get those two things on the record.

What I would be interested in, given the fact that we are in a period of economic restraint, given the fact that we do need child care options for parents that both parents can afford and the taxpayers can afford, I wondered if you had any advice or assistance to offer us as to how we can continue to provide child care spaces for parents in Ontario.

Ms Schulz: There was a lot in that, so I'm just keeping track.

Mrs Ecker: Yes, sorry. I didn't mean to put you on the spot.

Ms Schulz: First of all, in response to your comments about the voucher working document, I just wanted a little clarification: What you're saying is that MCSS staff put together a paper on a proposed voucher system without the knowledge of the minister?

Mrs Ecker: I have no idea where the document came from. All I can tell you is that it was not a document that was prepared at the direction of the minister, the direction of the deputy or the direction of myself, who is leading the child care review. None of us had seen it. It had not gone through any policy process that any of us are aware of.

I don't know where the Toronto Star gets its information, and that's fine; they do what they can do, but I can tell you that it is not the policy position of this government. That's one of the reasons we're doing the child care review. One of the reasons we've put together a working group, one of the reasons I am consulting with many of the child care providers out there, is to see how we can continue to have good quality child care options for parents.

Ms Schulz: So you're not considering vouchers.

Mrs Ecker: We are looking at everything that is on the table in terms of how we can provide a child care system.

Mr Cooke: Who put "voucher" on the table, then?

Mrs Ecker: The Toronto Star put "voucher" on the table. It certainly wasn't me and it certainly wasn't the minister.

The Chair: It's the government caucus's six minutes, please, of which two are remaining.

Ms Schulz: That would be our request: Without getting into the chronology of events, I think the issue here is if the government is not considering a voucher system, then the government should say so. In terms of --

Mrs Ecker: I said we're interested in all options and advice from individuals such as yourself.

Ms Schulz: In terms of parental choice, we would also appreciate an assurance from this government that parental choice includes non-profit, regulated child care. I'd also like to offer some clarification around your comments about the red book. In fact, I'm not in error. What you're referring to are federal child care dollars that were offered into the red book.

Mrs Ecker: No.

Ms Schulz: The strategic initiatives fund is a distinct fund Metro applied for. It will not cost the province a nickel. The money and the agreement are strictly between the federal government and Metro -- as long as we're clear about which pot of money we're talking about here.

Mrs Ecker: No. I'm very clear. I quite understand what's happening. Mr Axworthy has not agreed to make individuals deal with Metro on their own, and Mr Axworthy's officials have been very clear that they cannot provide us with details as to what money Mr Axworthy has been talking about recently. I'm not referring to the red book; I'm referring to Mr Axworthy's press conference of several days ago. We'd be very happy to talk to him about more money for child care in Ontario.

The Chair: I'm sorry to interrupt. You may be able to conduct that further at another time. We have the turn of the members of the opposition. Mr Colle.

Mr Mike Colle (Oakwood): Ms Schulz, I guess the comment I have is that again we see where the government spokesperson is blaming the press for putting things on the table. Every time they're given an opportunity to basically take the questions about voucher off the table, they're refusing to do that, because it's pretty clear that's one of the so-called solutions they have to the day care crisis, that they want to look at this as one of their so-called tools. If they had problems with the voucher system they would obviously take it out, and again they've lost another opportunity to put to rest the speculation, as they've said, that the media has created about the voucher system. So again and again, when they ever got the opportunity to take it off the table, they refuse, because we know that this is one of the so-called instruments they're going to use.

The question I have for you is that in the House, the Premier -- inside the House and outside of the House they've made these references to the fact that people have to look at solutions in their own neighbourhoods and streets and their family and churches, and that what they should look at is maybe finding neighbours that their children can stay with, relatives, local volunteer organizations I guess related to church and so forth. What is the reality of those solutions in downtown Toronto, for instance? Can this work as part of the solution to good child care in an urban setting?

Ms Schulz: I think it's been made fairly clear in terms of response from both parents in urban settings and also parents in rural settings that this is not actually a feasible option for people. In most cases, your friend or your neighbour should theoretically be at work as well, right? So they're not available. There's been some discussion about grandparents and so on, and everything that I've heard from both seniors' organizations, the rural child care committee and parents in Metro -- and I've been to a number of community meetings -- suggests to me that this is not an option for people. In a lot of cases parents tell me their relatives don't even live near them, so they're not available.

In terms of urban settings also, many people don't even know their neighbours. So you're asking people to put their children in the hands of someone they're not even acquainted with and go on faith that that person will be taking care of their child in a reasonable and adequate and responsible manner. But there's no reason to think that's the case. I mean, that's the danger of unregulated child care, that you don't have any idea what quality care your child is getting.

Mr Colle: The other sort of follow-up is, in terms of this crisis that is developing in the availability of child care spaces, what impact is it having on people's ability to earn a living and ability to cope with the stresses and pressures of trying to pay bills and raise a family? Have you noticed any fallout that is of direct impact on people's lives? I'm talking about some tangible impacts that you've seen in recent months with the basically near collapse, or certainly imminent collapse, it seems, of good child care.

Ms Schulz: I wouldn't want to be overly anecdotal except to say that one of the great difficulties we're having, being one of the few organizations -- because the government is not tracking the impact of these cuts. That's been left to organizations such as ours. And because the cuts have been done in an indirect fashion, there's a time lag between when a cut is implemented and what you find out later about what happened, which we're not getting, again, any assistance with from the government.

At this point all I can say is that I think the 25,000 people sitting on a subsidy waiting list are under a great deal of stress. I know that when Jobs Ontario child care subsidies were on the table at Metro earlier this year, there was certainly a huge momentum from parents who were receiving those subsidies, and in Metro it's particularly difficult to know who is receiving them because they've been rolled into the regular subsidy system.

Certainly, we had calls and letters and parents at every community meeting I went to saying they couldn't continue to work, they couldn't continue to go to school, they couldn't continue to do training if they didn't have their child care subsidy. That was working parents as well as parents on social assistance. Parents on social assistance were also quite devastated, because in addition to taking a 21% cut in their income, they were now looking at the loss of their child care as well.

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What I'm hearing from middle-income parents is, "If public funding is removed from child care, I'm making a large contribution already because I choose regulated quality child care," and many families are telling me, "We simply can't afford to pay additional money if public funding is removed."

Mr Cooke: I agree with you that the provincial government should actively pursue federal options and anything that Mr Axworthy might be offering. I must say, from my previous role and being at a number of meetings over the years with Mr Axworthy, it's not always easy to pin him down from the rhetoric that he might use in a press conference and what he actually means when it comes to implementation, but I don't think that's particularly new to you or members of the Ontario coalition either. So I have a very little bit of sympathy for the government and the minister trying to pin Mr Axworthy down on whether this is new money, whether this is ongoing money, and what it all means after the announcement was made a couple of weeks ago.

Ms Schulz: Can I just clarify something? Again, we keep referring back to this press conference, but that was a press conference about red book dollars. It was not a press conference about strategic initiative funding. The proposal I'm discussing right now is very specific. It's between Metro and the federal government. It's not a general discussion; it's a very specific proposal for streamlining child care services in Metro Toronto. My understanding is a letter is on its way to Alan Tonks approving this money, and that's why I'm asking this committee, and particularly why I was asking the government members --

Mrs Ecker: That didn't approve it. It came, but it didn't approve it.

Mr Cooke: In any case, I'm not here to defend the government by any stretch, but I also know that some of the strategic money that Mr Axworthy floats up in the air is three-year money that floats away at the end of the three years, so you have to be careful with that too.

I want to spend a little bit of time, because I think I understand what the voucher system is, and I certainly know you understand what it is, but I'm not sure that everybody else does. I think this is an opportunity, because we all get to using in-house language and people don't necessarily understand why it's so dangerous, especially when language like "parental choice" is used, which is the same kind of language that President Bush used to use when he was talking about parental choice for charter schools and a voucher system for education in the United States. So maybe you can just expand a bit about what the voucher system is and why it really does not improve choice.

Ms Schulz: A voucher system for child care is a way of targeting public funding directly to parents in the form literally of a voucher which parents can then take and use to "purchase" child care. Unfortunately, vouchers, generally speaking, are not -- the dollar amount that was referred to in this working document was half of the cost of regulated child care on a monthly basis.

Mr Cooke: Which would be?

Ms Schulz: Approximately $700, but of course that depends on age groups as well and what region of the province you're in. So this voucher proposal was definitely going to go to parents who could only use it -- unless they could top it up in some manner. The criteria that were outlined looked very strict and looked like they were criteria that wouldn't allow, for example, middle-income parents who could top up a voucher to use it. It looked like it was targeted more to people on social assistance. So those people would not have the money to top up the voucher. That means they would have $350 a month for their child care and they'd have to go out and get someone in their neighbourhood or a babysitter to use the voucher.

I'm sitting on a subsidy waiting list right now and I currently have a babysitter. Obviously, as you heard before, I'm not happy, and I'm currently paying about $600 a month. So $350 --

Mr Cooke: Would not do it.

Ms Schulz: It's not going to cut it.

Mr Cooke: So if we went to a voucher system, the implications for the regulated child care system in the province would be what?

Ms Schulz: It would close down. You'd be removing public funding from the regular subsidy system and putting it into a voucher, so the regulated system would close down, with the exception of probably a very few programs in affluent neighbourhoods that might be able to stay alive, but not many.

Mr Cooke: The number of spaces in Metro again on the Jobs Ontario: That was extended till the end of this year, so another week or two, correct?

Ms Schulz: Yes.

Mr Cooke: The number of spaces again?

Ms Schulz: It's approximately 3,580.

Mr Cooke: Those spaces now are guaranteed just till the end of this calendar year.

Ms Schulz: Yes. What we're talking about in terms of losses are the JOT subsidies, which are 3,580, and then you're talking about the other cut because of this 47% cut to municipal transfer payments. So you're talking about another loss of about 8,621.

Mr Cooke: So very early in the new year, perhaps right on January 1, those spots or a good portion of those spots will be gone to the Metropolitan Toronto system.

Ms Schulz: That's right.

Mr Cooke: Do we know at this point what those parents are going to do?

Ms Schulz: I'm assuming, depending on what situation they're in -- in order to access a subsidy, you have to be working or engaged in retraining or upgrading your education. You can't get it otherwise. So they'll leave. They'll leave their jobs, they'll leave their retraining or education, and they'll be stuck at home.

Mr Cooke: So we could see more people going back on social assistance because of lack of access.

Ms Schulz: Oh, yes. You'll just pay all over again but you'll pay it to someone to stay at home rather than -- incidentally, it's more expensive to pay for someone to stay at home on social assistance than it is to pay for their child care.

The Chair: Thank you for coming forward today to make your presentation to the committee.

Before we break for the dinner hour, I have two announcements. The first is that the full subcommittee will have a meeting in committee room 1 at 5 pm, Mr Phillips, and the other 5 o'clock arrangements remain the same as the previous evening's.

Mr Phillips: Committee room 1 at 6, is that right?

The Chair: The full subcommittee meeting in committee room 1 at 5.

Interjections.

Clerk of the Committee (Ms Lynn Mellor): I think I misspoke myself when I told you 6.

The Chair: It's at 5. We'll recess until 6 o'clock.

The subcommittee recessed from 1657 to 1800.

The Chair: Good evening, ladies and gentlemen.

Mr Phillips: Mr Chair, just before you begin, I just wanted to announce that as per the request from Mr Silipo, the subcommittee met today. I want to report that the subcommittee will be requesting the appropriate cabinet ministers to appear at the start of clause-by-clause to give an explanation of any significant amendments they'll be proposing. So that's on the Monday, whatever that date is -- January 22. That was per Mr Silipo's request.

The Chair: That clears up everything. I'll give you an update, Mr Silipo: A letter from Minister Leach's office is expected tomorrow; the privacy commissioner, we have that document, your caucus has been given a copy of it -- I believe Mr Cooke has that; and the final one is the Minister of Labour's speech which we're attempting to get hold of from another presenter last night who asked about that.

Mr Tony Silipo (Dovercourt): I appreciate that update very much. Thank you. I'm not sure if what's been worked out through the subcommittee actually addresses necessarily the concern I raised last night, because I don't know -- I hope -- that there will be amendments from the Minister of Labour around pay equity, but I don't know that there will be. I'm assuming that under that arrangement, if there aren't going to be amendments, we won't see the minister here. That still remains a concern, but maybe I should just pursue that through the subcommittee.

HANOCH BORDAN

The Chair: Can I have Mr Hanoch Bordan please come forward. Good evening, Mr Bordan, and welcome to our committee. Thank you for being patient as we cleared up some of that housekeeping matter. You have one half-hour tonight to make your presentation. You can use that time as you see fit. Most people leave 10 minutes or so for questions at the end of their presentation. I would ask that you read your own name into the record for committee members and Hansard and perhaps, if you represent an organization, you can do that. If not, that's fine.

Mr Hanoch Bordan: Thank you very much for allowing me to come here today. My name is Hanoch Bordan. I come here representing myself only, but I come here as a concerned citizen. I find this legislation very disturbing and I've come here to urge the government and your legislative representatives to reconsider the approach of this legislation. I've come to urge the government to be truly conservative in its approach to Bill 26. The bill is radical and, in my view, is not in conformity with what I see to be conservative philosophy.

The Conservatives ruled Ontario for many years, but they weren't radical. They governed as they were elected to do, and as this government was elected to do, but they did so within established parliamentary traditions. They stuck to the rules. They were conservative in the best meaning of the word; that is, conserving the best of the past. Our democratic government needs both approaches, both to conserve the past -- our parliamentary traditions, our conservative parliamentary traditions -- and a liberal approach to change things when we need change.

No one denies that the present government was elected fairly and has to govern. It has a duty to govern and a responsibility to govern. But this bill, in my view, goes beyond what democracy requires, what parliamentary tradition demands and what conservative philosophy teaches us. Let me explain what I mean.

In parliamentary tradition -- and I don't mean to be lecturing you; I'm just giving you my opinion -- there is a time and a place for emergency legislation. A war starts, an earthquake, a famine -- all kinds of disasters can happen -- and then the government is called upon to do something and the Legislature may be called upon to pass emergency legislation. This clearly is not one of those times. If we have any problems, fiscal problems, they've been around with us for a long time, and they're going to be around with us for a long time. There is none of this pressing emergency.

A bill that makes such major changes needs to be considered carefully by experienced legislators, which you are, but you don't have time in this particular case. I would argue even that it's in the government's best interest that its legislation be subject to scrutiny. Every government knows this. That is the parliamentary tradition, that is the concept of the loyal opposition that we all know. You have all been in opposition at some time or other, and you know what an important role you fulfil. If you're not given this role to fulfil, then we might as well abandon the Legislature.

I would say there is no emergency now and no reason for this type of emergency legislation with these short deadlines, because there really isn't time. I really wonder how many members of the Legislature have had time to read the entire bill fully and consider its many ramifications -- and you are experienced people -- let alone the public, which doesn't have this experience to look at it. Surely the Legislature exists and the opposition exists and backbenchers of the government exist so that proposed legislation should be studied carefully and all its implications assessed.

In my view, the government has not made any case for proceeding with this bill on an emergency basis. Proceeding in haste, without giving a convincing explanation, clearly violates conservative philosophy. They may be perfectly legal in what they do, but I don't think it is proper.

Also, another factor, Bill 26 gives too much power to the cabinet. It is a principle of parliamentary government that the cabinet has the right to govern, but within certain limits. The Legislature gives the power to ministers to carry out routine tasks, but the power relates to the Legislature. If the Legislature gives all the power to the cabinet ministers, then it might as well close down the building and you may very well go home. There is no role for the MPPs if the cabinet makes all the decisions.

Would any conservative want that? Would anyone want to do away with MPPs? If you have no decision to make, what are you going to do? Surely, major decisions must remain with the Legislature. This has nothing to do with right or wrong or the merits of the case. There may be some very good merits in this bill, there may not, but we don't have time to consider it. What we do know is that it's giving too much power to the cabinet, in my view.

Again, it is called an omnibus bill, but it's not a true omnibus bill, in my view. It is a wrong use of an omnibus bill. In parliamentary tradition, an omnibus bill is used to change a number of things, a number of routine things in a vast number of bills. For instance, if it says "he" in 47 statutes and we want to change it to "he or she," we have an omnibus bill saying we will change "he" to "he or she" in all 47 statutes. This is a bill of a routine nature, a simple thing which all MPPs can agree to and say, "Very well, we don't need committee hearings on this because everyone agrees we want to change `he' to `he or she'." Bill 26 doesn't meet this test and it is thus not in the spirit of good conservative parliamentary government.

As a final word I would say to the government, to the members of the government party, imagine five years from now -- I'm not wishing you anything, but imagine five years from now you're in opposition. Would you want the cabinet to have the kind of power that is given in this particular bill? I would say to the government -- and you people have far more influence with the government than I do, and maybe someone here has the Premier's ear -- you won the election, you have the right to govern, but you have been poorly advised. Stick to the rules. Be conservative. Govern, but don't abuse your power. That's the lesson of parliamentary democracy and that is true conservatism.

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The Chair: Thank you, sir. We've got six minutes per caucus. We'll start off with the opposition caucus.

Mr Phillips: I appreciate your thoughtful presentation. You obviously spent a good deal of time thinking about these issues. I just want to comment on a couple of your comments, firstly about it not being an omnibus bill. I agree with you on that.

I would just say to the government members, you often use Bill 175 as your model. You say, "Well, the NDP did this on Bill 175." You should be aware that Bill 175 was very different from this. Here's what I said in the debate on Bill 175, and this was in November 1994:

"I'm pleased to join the debate on Bill 175 and to say I guess at the outset that I think this is a useful process. The members are all aware that what this is, to use our jargon, is an omnibus bill that is designed to handle a whole bunch of housekeeping items and avoid the Legislature having to open 30 or 40 different bills and to debate each of those bills. I think in a rapidly changing environment where technology, among other things, is changing as quickly as it is, this is a useful process and one that we can be supportive of."

Then I went on to say about Bill 175, the NDP bill:

"As members may recall, the bill was introduced in the spring" -- it was originally introduced in June -- "and I didn't think there was enough time in the limited time in the spring for all of us to get input from interested parties, so it was delayed until the fall." The NDP government agreed to simply delay it until the fall. "I think that was a useful process and I think we can support an omnibus bill like this, one that speeds up the process, one that deals with, as the preamble says, non-controversial matters, and one that can save the public money. They're all good ideas. So I have no difficulty with the process, and in future years this government or a new government will probably want to employ a similar technique to be as efficient as we can in keeping the legislative bills in the province up to date. So the process is fine."

That's what I said about Bill 175, which was an omnibus bill, I believe, essentially in the true interest of an omnibus bill.

There has not been one presentation to us, even people who superficially support the bill, that has not said, "We have not had time to study the bill." Even the ones who support the bill, except perhaps the mining association, but everybody else, all the business groups, have said, "We have major concerns about components of this bill and we have not had time to study it." Two of the best business groups I know, the CFIB and the board of trade, in terms of knowledgeable people, have both said, "We just simply have not had time to study the bill."

I think you make a good point that there's no emergency. This bill was introduced three weeks ago, November 29, and it would have been law just as you were beginning to speak. At 6 o'clock today, this would have been law. My point was always, if the government believed that the $1 million an hour was just so crucial that it had to be dealt with by this time -- you've now been in office for six months -- I don't know why it took you until November 29 to put forward those emergency matters that you felt had to be dealt with by the end of the year. I think the reason it came in this form is because you thought you could get a whole bunch of things through without scrutiny.

I guess, sir, I'm more thanking you for pointing out the problems with the bill in terms of it not being a true omnibus bill. I've certainly learned that things go around and you should, when you're passing legislation, make the assumption you may be in opposition when that legislation is going to be used against you. I've been there and Mr Silipo's been there and I dare say at some stage you'll be there. So I appreciate your comment. I think my colleague had a question.

Mr Crozier: I'll just be able to make a comment. You've opened up an area, Mr Bordan, in your comments. I've only been here two years; I was elected in a by-election and re-elected this last time. Successive governments have amended the standing orders so that it limits debate. As each government has changed, because it doesn't like what the opposition's doing, debate has been limited, to the point where we now can have closure with very limited debate.

So your points here are well taken. I think they relate to that. Those of us who were elected to come down here and speak on behalf of our constituents sometimes are limited, but as you say, all governments will have to live under those rules some day, so they should take thought to it.

Mr Bordan: I would add that that was also a mistake, in my view, whether it was an NDP government or a Liberal government or a Conservative government. If they do wrong, then they done wrong.

Mr Silipo: Mr Bordan, like my Liberal colleagues, I too appreciate very much the comments that you've made. I hope your comments strike a chord with the government members, because I think you've addressed in the process issues here very much the issues that have driven us to take the steps that we have taken as an opposition.

We believed this bill is so fundamental in terms of the major changes, as you yourself indicate, it puts forward and the way it significantly alters a variety of things. It gives powers to municipalities to tax in a broad way, in a way in which there's even at this point still some dispute about exactly how broad. But even as group after group comes in front of us, we point out to them, "Are you aware that it says this or it's able to do this?" and they say, "Well, no. If it does that, then we're not sure that we're so much in favour of this bill," or "We'd have concerns, at the very least," or "We should take some more time and take a look at it and reflect upon it."

Maybe if I could ask you one question it would be, what is your sense -- because I could reiterate a lot of the same points you have here -- about what it is that is driving this government to separate itself from that conservative philosophy and approach that you point to in your brief and that you've spoken about that has characterized certainly even previous Conservative governments and to act in this way?

Mr Bordan: I might be wrong, but I cannot conceive of a government of Leslie Frost or John Robarts or Bill Davis acting in this way.

You ask me what I think motivates the Conservative government. I think they are men of goodwill who are, in an excess of zeal, trying to do things they think are right. I feel it is unfortunate and that they should look to their tradition and back off a little bit, because they may do this province and themselves irreparable harm if they proceed.

I don't deny their goodwill and their right to govern as they see fit within the parliamentary tradition. I'm saying that taking these powers is going, in my view, a little bit beyond it.

Mr Silipo: We've tried in a variety of ways to point out to the government members that we too acknowledge that they won the election on June 8 and that they have the right at the end of the day to pass whatever laws they as a government deem to be in the best interests of the province, and that we're not here to stifle their ability to do that.

But what we have been trying to do is to also point out to them, as you point out, that there is a parliamentary tradition and a process that is part of the parliamentary, democratic system that we live under, and that when there are issues of such importance as those that are covered in this bill, that involves debate, involves an ability of the public and, as you've pointed out, even of the legislators themselves to fully understand what it is we're talking about.

We've had more than one example of not just government backbenchers but indeed cabinet ministers being not as sure as one would expect them to be about the provisions of the bill that they are responsible for. Obviously, in the cut and thrust of the partisanship here, we take those issues and we embellish them to the point of saying, "This is what's going on here."

But to just sort of stand back from that, what strikes me most about your presentation is the calm of it, if I can say that, and the fact that I think you've struck, I hope, a chord, and not just with us on this side, because one would argue that it's easier to do that when you're in opposition, to be supportive of the parliamentary process, but I think the test also lies in what governments do.

There was Mr Phillips's reference back to Bill 175, which I know government members have used in the past to say, "The NDP passed omnibus legislation." Of course we did, but I think the question is the difference between what a bill like Bill 175 did, which was largely housekeeping -- although there were some substantive issues in it and again even there allowed for a deferral to the next session of the Parliament for exactly the reasons that we're talking about here: for there to be more time.

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I guess really I'm not sure I have any other question of you, other than to ask of you, what more can we do -- we on this side, you as a member of the public -- to impress upon this government that the process of debate and understanding the changes we're making are as significant as the changes themselves that we want to make?

Mr Bordan: I think the only thing we can do, and what I'm trying to do, is to try and communicate with the Conservative members of the Legislature, who are all people of goodwill, I'm sure, and to try to tell them that my opposition is not because I'm a member of an opposition political party -- because I'm not; I'm an independent -- but that in my view this goes against the whole grain of what has made Ontario such a wonderful place to live, and I have certain apprehensions about that. I would say that.

Mr Young: Thank you very much for an excellent presentation. I really appreciate what you're saying. I do have a question, though, with regard to your comments on a former Conservative government.

I think you may agree that we're in an extraordinary time, and extraordinary times need extraordinary measures. The member opposite was talking about the timing of the bill. I think the bill was introduced now because we have to make change happen as quickly as possible. We're spending, in this government, $1 million an hour on interest and it's growing. Frankly, it took the bureaucrats that long to write it. It's a big bill, so it took them that long to write it and bring it to the Legislature. So that's what I think explains the timing.

The ministers get powers to make things happen with the municipalities or hospital boards or school boards if the change isn't happening. The Toronto district health council has said that we should close 10 or 11 or 12 hospitals in Toronto because we're financing bricks and mortar. What I'm wondering is, what hospital board is going to say: "Okay, we'll be the one that closes"? That's not their mandate. A hospital board is mandated to do something different, so that's a very difficult thing to have happen.

We have 168 school boards in Ontario. What school board is going to say: "Well, we'll amalgamate, we'll give up our jobs," or any of the institutions that may not be financially viable or may not be serving the people with as direct a form of democracy as we wish they would? How is that going to happen unless there's someone there to make it happen?

Mr Bordan: Okay, it's a fair question. I would say, though, just to begin with, that I agree with you that these are difficult times and tough times. I'm not sure they're necessarily extraordinary times. I think radical measures are necessary.

For instance, in Britain at the time of the Battle of Britain during the war, Parliament made all kinds of laws that it wouldn't have made otherwise. But these aren't that kind of extraordinary times. They're difficult times. It's a tough time, yes, but if we've been losing this money -- we have to maintain our parliamentary traditions or we're also going to get very bad laws, and if we get bad laws, it's worse than having no law at all, because people are hurt by them.

Of course, it may be necessary for the Health minister or certain health councils to have certain extraordinary powers, but I would suggest that this would be better dealt with in a special bill dealing with health. In other words, I think this omnibus bill should be broken up into several significant parts, and then we could deal with this.

I would say even though it might be necessary for someone to be given certain dictatorial powers, and I use that word advisedly, there should be some kind of appeal process, because we all know that many of these decisions are made not by ministers but often by bureaucrats and many people get hurt in the process, not through anyone's wanting them to get hurt but because of the system.

Mr Young: Would it address your concerns if parts of the bill had a sunset clause? In other words, this bill is an active bill until it dies within a given time period, and if any future Parliament wanted to re-enact it, it would have to do it and it would have to get the agreement of the voters?

Mr Bordan: I think it's very hard to cope with this bill as it is now because it takes in too many things. It takes in health and mining and education and municipal powers. It's too broad for anyone to grasp, so I as a citizen can't even figure out what is wanted, what the government is asking for, except that it wants certain dictatorial powers. A sunset clause is probably a good idea with respect to any extraordinary powers, yes; in other words, that it should expire in, I don't know, one year, two years. I think when you give extraordinary powers, you have to put an expiration date so that it can be rethought. Is that the word? Rethought, yes. A good idea.

Mr Sampson: It's interesting that you should mention, I think it was facetiously, that we might want to close up the shop here and the MPPs go home and shut down the Legislature etc. I've only got a minute, so there's an interesting fact I think I might want to leave with you. If we were to do that -- send all the bureaucrats home, send all the MPPs home, stop paying them, close down committee hearings etc -- we'd only save about $4 million to $5 million. The rest is actually spent by somebody else or is interest and, frankly, each day of each week of each year, the amount we spend on interest grows and grows and grows.

The message we tried to relay to the people of Ontario through the election campaign and have tried to act on since then is that because of that downward slide, so to speak, that you get from the interest chewing away at your ability to fund other things, we think we are in extraordinary times financially and we need to deal with that. That's what this piece of legislation is attempting to do. I just want to leave that thought with you.

The Chair: Thank you, Mr Bordan, for coming forward today.

REGIONAL MUNICIPALITY OF YORK

The Chair: Could I please call on the representative from the region of York, I believe Mr King, regional chairman. Good evening, sir, and welcome to the standing committee on general government. You'll have 30 minutes tonight to present. You can use that time as you see fit. I suggest you might leave some time at the end of your presentation for response and questions. I would appreciate it if you would name yourself and your organization for the record for the benefit of Hansard and the committee.

Mr Eldred King: Eldred King, chair of council, region of York. Mr Chair, members of the committee, I thank you very much for the opportunity and I trust that your appetite at this particular time of day is still subject to receiving some further dialogue as it relates to Bill 26, rather than the dinner you're probably looking forward to having.

Mr Sampson: We already had it. That's why we have no appetite.

Mr King: You certainly do work farmer's hours at this particular job.

I have given to your staff a submission that I believe is important. I apologize to Mr Hardeman, because he has heard basically what I am going to say before when we had an opportunity to address the minister on this matter. It has to do with the migration of powers between the tiers of municipal government.

I'm not necessarily going to follow the context of the letter, but I remind you that the makeup of the council of the region of York -- and that is not to say there even will be a regional government in the region of York after we deal with the GTA etc. But at the present time, and if this bill does in fact become law -- which I expect it will because I believe there are many things in this bill that this province needs at this particular time. I will tell you from the beginning I support the general spirit of the bill and I support the general spirit that the present administration in the province of Ontario is moving down the avenue of approach to correct certain situations that have been created over the last 20, 30, 40 years and, more recently, over the last 10 years.

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I would remind you of the makeup of York regional council. There are nine area municipalities, and five are somewhat larger than the other four. The way the bill is designed now, those five municipalities, with a simple majority and with a simple majority of the members of council, could transfer powers that may be to their liking, but the four smaller ones would be left out. Consequently, the theory of regionalism and sharing the resources would be gone. The four little ones would be left out in the cold.

This does not only pertain to the region of York. I think it is fair to suggest that the region of Waterloo would fall in the same category and the region of Niagara would fall in the same category. I'm not positive about the region of Ottawa-Carleton now with the directly elected regional councillors, but it could happen in many regions, and I believe there should be absolute direction by the province of Ontario as it relates to the responsibility and jurisdiction of the different levels of municipal government, if in fact we are going to continue with two-tier municipal government in the province of Ontario.

I don't think you can leave it to the local politicians. They're all out there, and I will include myself, we're all out there at this particular point in time. We know something has to be done, but turf protection, I would say, is most important in the minds of most of them at this particular time. So I would suggest that your migration of powers, yes, is important. There is a great deal of difference between the area municipalities in this province. They range from 750,000 population to probably 750 population. It may be fine for some municipalities within regions, but it certainly doesn't fit everywhere.

I am suggesting that you may recommend some modifications to that particular part of the bill and, just as a safeguard, rather than a simple majority of a council, it be two thirds. At the present time there are many areas where we require two thirds a majority of council in order to assume a responsibility; in fact I think we require two thirds a majority of council to transfer a roadway from an area municipality to a region. Two thirds would overcome my concern and would protect those smaller municipalities which do not have the resources and the strength to administer some of the responsibilities at the regional level.

That is basically my point. I have made my point to the minister, and Mr Hardeman, as I said, has heard it before. But that is my basic concern with the bill. I can see York regional council transferring powers every other meeting if it happens to fit its political interest, and I think there should be something more fundamental in the bill than exists at the present time. I can see there are many flaws with just a simple majority. That is my concern with the bill.

The Chair: We've got eight minutes for each caucus to ask questions. We'll start with Mr Silipo.

Mr Silipo: Mr King, it's nice to see you. I know we've talked on the phone a few times but I don't think we've ever met in person. First, I just want to make sure I've categorized your presentation here correctly. You're saying that you're essentially in support of particularly section 6 of schedule M that allows for powers to be shifted, but you have some concerns that you've outlined to us. Those concerns, you're saying, should be addressed by changes to the legislation?

Mr King: Yes, I think a simple modification where it would require two thirds of the municipalities and two thirds of the majority of councillors to transfer a responsibility up and down.

Mr Silipo: You've indicated, I think, in reference to Mr Hardeman, that you've met with the minister -- I'm assuming the Minister of Municipal Affairs and Housing -- to express these concerns.

Mr King: Yes, I have.

Mr Silipo: Have you had any response that you can share with us?

Mr King: No, I have not, other than the minister at the time and Mr Hardeman. I trust I am relating the situation as accurately as I possibly can. The minister, I think, wanted to, through this particular bill, give the municipalities the opportunity to transfer authority and jurisdiction up and down. Certainly it does overcome certain legislation that exists at the present time.

I think it was Bill 7 that transferred some powers related to waste management back and forth, and we have been asking for at least five years in the region of York to have the authority to become involved in the transit business. It does accomplish those things. We are also looking at moving fire to certainly a different level than it is at the present time. It does accommodate those things, but what I want to overcome is that it is not possible to move them back and forth at the whim of different councils.

Mr Silipo: That's the point I wanted to also address, Mr King. As we all know, the Golden task force is about to report in the new year, out of which we certainly expect some changes to take place. I think we're all assuming and expecting there will be some changes.

Wouldn't it make more sense to you, given, I think it's fair to say, the enormity of some of the changes that we're likely going to have to contemplate within the governance in the GTA, that we take a look at whatever the government is proposing to us out of the GTA task force and look at legislation that specifically says whether we will have two tiers of government at the municipal level, and if so, what powers should be attributed to each, and all of that, and bring that forward as a piece of legislation rather than just this kind of hodgepodge approach that says, "You can shift powers between one level and the other"?

As you say, that could change from meeting to meeting potentially as you go on, rather than a piece of legislation that says, "In the view of the government, on the advice of the task force, this is what we think should be done," some opportunity for some feedback, and then at the end of that process, the government can make its decisions.

Mr King: Mr Silipo, I think that's exactly what will happen. The thing is, we do exist as a region at the present time. There is a bill before the Legislature and that bill does impact the existing situation. I am not prepared to even suggest what might happen in the GTA, but I do know that what we have at the present time, the authority that is legislated upon me as chair of the council and the responsibilities that the present provincial administration has to deal with, those things are a fact, and I want to deal with those things.

Mr Silipo: I appreciate that. I wasn't asking you to presume what would come out of the task force and what restructuring, except to say I think we probably all assume there will be changes.

Mr King: I think this bill needs modification regardless of what may happen in the GTA, because I believe things are going to be very different throughout the province of Ontario, and I think there needs to be protection, because it may apply to the balance of the province of Ontario in the future.

Mr Silipo: Did you have an opportunity to have your discussion with the minister prior to the introduction of this bill?

Mr King: No, I did not.

Mr Silipo: So it was since the introduction of the bill?

Mr King: Yes, it was.

Mr Silipo: Just to come back to this point then, I want to make sure I understand more fully why you would think -- and again, if I'm categorizing your position incorrectly, please correct me -- is it because the provisions exist in this bill, in Bill 26, that you're saying we need to make these changes, to make sure that there isn't a back-and-forth?

Mr King: Yes.

Mr Silipo: What strikes me -- let me put it this way and see if you agree or not -- it seems to me that rather than this kind of approach that says, "Yes, we understand that the restructuring of the GTA, in terms of what it may look like, is going to be dealt with at a later point," while at the same time, within this bill, there are provisions to shift powers between the two levels of the municipal level of government, the two tiers -- I have to ask myself, what is the sense of beginning that possibility under this bill when the government is saying, and we're all assuming, there will be other changes that will come about in the GTA in the not-too-distant future as a result of the GTA task force?

Mr King: I'm not going to give you an answer to your question, because I don't think that is for me to conclude. I only know my concern is what exists at the present time. I know the point you're getting at. Why don't we wait until the Golden task force? I don't know what the Golden task force is going to do. I do know what is before me in print at the present time and that's what I'm concerned about.

Mr Silipo: And one of your key concerns in terms of what's here now is the instability of what may happen, that is, that powers can be shifted back and forth depending on --

Mr King: Yes, and the unfairness to those smaller municipalities that may exist within a region where there are larger ones.

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Mr Hardeman: Recognizing that I have heard the problem explained before, I just want to dwell for a moment on the issue of the evolution of responsibilities from the upper to the lower tier and the other way around, and your suggestion that, because of the way the municipalities elect local representatives to the upper tier, in some cases they may very well vote to transfer the responsibilities based on wearing the local responsibilities as opposed to the upper tier.

Mr King: Yes, wherever it is politically expedient. You know politics equally as well as I do, and political expediency sometimes doesn't always give us a correct answer. I will remind you that in the planning legislation that existed three or four months ago that has been amended to some degree, there was the possibility of transferring and delegating the powers related to approving draft plans of subdivision. Our regional council agreed that the area municipalities should assume that responsibility.

I have to remind you that I don't think that was wise and I told our council that, but to take it back at the area municipal level, to me there are now going to be nine organizations giving draft plan approval to plans of subdivision where previously there was one, and I'm sure that it's going to cost the taxpayers more money, or the development industry or whoever. I just think it was a very regressive step. I remind you that that can happen, and it is sometimes as a result of political expediency rather than serving the public well.

Mr Hardeman: The other thing you mentioned was the proportionate vote that's required to do that. In fact you indicate that you think it should be a two-thirds majority as opposed to the direction set in the act.

Mr King: Yes, a simple majority.

Mr Hardeman: I think you refer to the fact that four smaller municipalities could make the difference. I was just going through the bill. In fact, to change the power or the responsibility from one tier to the other would require the majority vote of the upper-tier municipality, the majority vote of the lower-tier municipalities --

Mr King: That's the same thing.

Mr Hardeman: -- including the majority vote of the electorate in the total municipality. So in fact it could not be the smaller of the municipalities making it happen.

Mr King: No, the smaller municipalities could not make it happen. The larger ones could.

Mr Hardeman: The other thing I think you mentioned, and I put this out as a question, not as trying to redefine what you have read in the act, is the issue of the provision of this bylaw, in assuming the powers of the upper-tier municipality, to assume the local power passed under the clause shall not be repealed in whole or in part after it comes into force. So the issue of dealing with the back-and-forth is non-existent in the legislation. In fact, once transferred, always transferred.

Mr King: Then if that's the case --

Mr Hardeman: This deals with the transfer from the lower to the upper tier. I think if you read further in the act, the same applies to the transfer in the opposite direction.

Mr King: The other way, yes.

Mr Hardeman: So it is an issue of the local autonomy having the ability to make the transfer where it is most appropriate to deliver the service, and then in fact it will stay there for the duration unless there was a change in the act to allow that. I just wondered if that would solve some of your concerns.

Mr King: Yes, it definitely would.

Mr Hardeman: Just one more question: I think you said when we started off that generally you supported the direction. Do you feel that this does grant local autonomy and that it does, as the mayor of Mississauga told us a few days ago, get the province off the back of a municipality to do what it wants for its local constituents?

Mr King: Yes. Generally speaking, the bill does that. Again, I think that the province needs -- there are many acts, and regardless of what you may have heard from other presentations, there are many acts which still interfere with more or less getting the province or the region off the area municipalities' backs that we will have to deal with in the future.

I think if it's just a simple thing of the environmental approval to put a pipe in the ground, I don't believe that is being addressed in this bill, but it certainly is something that we need to be addressed because we don't need the region and the local municipality and the conservation authorities and the province of Ontario approving just putting a sewer pipe in the ground.

Mr Young: Just a slight change of topic: In Bill 26 we're going to ask that for anyone who's employed in the public sector who makes over $100,000 a year, their salaries be published. That's in the interest of accountability, and I wondered what your view is on that.

Mr King: I have no problem with that, sir, whatsoever.

Mr Young: No problem with that.

Mr King: No, none whatsoever. Anyone who's earning over $100,000 should be able to reveal it to the public as far as I'm concerned.

Mr Young: Okay.

Mr King: I'm not afraid to tell you that for the first time in my life I received more for corn out of the field this year than I've ever received before. Thank goodness.

Mr Tascona: Mr King, I'd just like to question you on schedule K, on the freedom of information. The amendments allow for frivolous or vexatious requests to be refused by the head of an institution and also there's a fee application. I would just like to ask you what you think of that.

Mr King: I would have to tell you that I'm not totally familiar with how Bill 26 is going to deal with that, sir. I think the freedom of information act has many flaws in it and it does need to be corrected, but I am not prepared to --

Mr Tascona: Okay. What about schedule Q, have you --

Mr King: I'm not conversant with that schedule either, regarding the interest arbitration. I think arbitration is -- I don't know just where they are when they make some of the decisions they make.

Mr Tascona: What has been your experience with respect to arbitration?

Mr King: My experience with arbitrators, having sat on a GO Transit board and the arbitration award that was directed to the employees of GO Transit about four years ago was absolutely ridiculous. Knowing the economy that we were involved in, I don't know what the arbitrator was thinking about, and the experience I've had with arbitration as it relates to police personnel has been the same. I just don't know what they're thinking about when they give the awards.

Mr Tascona: What we're looking to do is put some fiscal reality into the situation by mandatory criteria, which would include ability to pay.

Mr King: I want someone to define what "ability to pay" means, because the province of Ontario now, if we're spending $1 million -- what is it -- an hour?

Mr Young: An hour and growing.

Mr King: We don't have any ability to increase anyone's salary. I would suggest to you, if I may be so bold, that we certainly are going to need something, come the completion of the social contract, in order to put some stability to this whole situation.

Mr Phillips: I appreciate the well-regarded Mr King being here. The bill as far as we can see is quite a major bill.

Mr King: Yes, it is.

Mr Phillips: It impacts municipalities in a whole variety of areas. Would you agree that it's quite a major bill for municipalities?

Mr King: It's major and it still doesn't touch all of the areas of concern that I have where there has to be a greater interpretation and explanation of the division of authority.

Mr Phillips: Right. Has your regional council had an opportunity to review the bill and to give you any --

Mr King: Regional council are not even aware of the fact that I am here. I am not presenting the position of regional council. I am presenting the position of Eldred King as chair of that council.

Mr Phillips: Right. You are aware, though, that tomorrow will be the last day when we can have any input --

Mr King: Yes.

Mr Phillips: -- from people in the Metro area, even though, as you say, this is huge and has major impact for municipalities. Does it concern you at all that your council has not had a chance to review it? In fact, I think you said you yourself haven't been into schedule Q in any significant way or the freedom of information section.

Mr King: Mr Phillips, I think that it would be fair to conclude -- and I know that the region of York has in fact presented to the Minister of Municipal Affairs and the Premier of this province many amendments that we believe necessary to bring forth the changes. I am certain that the area municipalities, each and every one of them, have more than likely dealt with this bill at their local level rather than at the regional level.

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Mr Phillips: We'd like any advice they have for us then and, if they have, you might suggest they could forward their comments to us because --

Mr King: Certainly I will, sir.

Mr Phillips: -- we met this morning with -- was it this morning or yesterday -- the mayor of Markham whose council has not yet dealt with it.

Mr King: No.

Mr Phillips: So we would appreciate any of that. Within the bill, you've touched on the restructuring proposal and on the migration of services. You're very experienced. The same principle applies outside of the regional areas and I'm just trying to get your advice, if you can for us.

If a larger municipality can take over a smaller municipality and the smaller municipality -- applying the same principle, and that is the majority of electors, but even if the small municipality votes 100% against it, the larger one can take it over and there is no appeal anywhere, to the OMB or to the Legislature or to the minister. Do you support that proposal?

Mr King: I think that there is certainly a degree of unfairness. At the region of York, since the beginning of January of this year, we have been in the governance review process and, yes, we have been bogged down by the discussion related to boundary changes. I have told our council and I have told the public that, to me, one boundary is equally as sacred as another. I think it is extremely unfair for a large one to consume a small one.

I have a totally different approach to how I think municipalities should be formed in this province, and I believe that you have probably heard of that if you have had a presentation by the region of Waterloo.

Mr Phillips: We haven't yet, but we will.

Mr King: I have personally stated that I believe there should be the number of municipal governments in this province as it relates to the number of counties and the regions and probably eight or nine separated cities. I believe under that that there should be some community organization where each community -- and you have heard this, I'm certain, that it's the communities within our municipalities that are important to the residents. The municipal boundaries really don't mean that much. In fact, they cause a heck of a lot of problems, trying to get across them.

I just think that in the region of York we would have much less urban sprawl than we have, and this applies to any area where there is an urban and a rural component. I just think where the small municipalities had the opportunity to share in all of the industrial-commercial assessment of the total region, as we now share it for schools and the regional purposes, that it would be much better for our residents and much simpler for the Minister of Municipal Affairs.

Mr Phillips: In the bill, Mr King, there's a provision that there's a fair bit of debate about what the intent is, and that has to do with the imposition of fees, charges and taxes. I guess we've had two legal opinions now from municipalities saying that this section -- and it's on page 147 of the bill. I'm sure you've had a chance to review it. The mayor of Mississauga and the city of Toronto believe that this provision would permit the imposition of, for example, gas taxes and perhaps sales and income tax. The Minister of Municipal Affairs says it doesn't.

I guess I've two questions for you really and I'll ask them both. Has your legal counsel had an opportunity to review it and come to a --

Mr King: No, I have not asked them and I would not let our legal counsel give you an opinion as to what the interpretation of that is --

Interjection: Why not?

Mr King: -- and you won't get one out of me either, sir. As a layman, as I read that, it doesn't give us any authority. It doesn't mention income taxes. It doesn't mention poll tax. I don't know where that's coming from. As far as user fees go, I was the mayor of the town of Whitchurch-Stouffville for six years and we had user fees at the arena. They're not new, sir.

Mr Phillips: No, but the key I think is what do the municipalities want, because if some of them want, as Mayor McCallion said yesterday, the right to impose a gas tax and the municipalities believe this gives them that right, then we should know that. We should at least know that when we're voting on it. I don't think you can expect the Legislature to vote on something when it doesn't know what it means. So I'm just trying to get from leaders like --

Mr King: I would only suggest then it be modified with wording that everyone understands.

Mr Phillips: Well, that's helpful. And would your instructions to us be to word it in a way that prohibits a gas tax or word it in a way that permits a gas tax?

Mr King: I will give you a little story. It was a meeting between the regional chairs of Ontario and the former finance minister of the administration under the Honourable Mr Peterson. Mr Nixon stood at the end of the table before the regional chairs and he said municipalities will never get the right to take any gas tax. I believe that's what the position of the province will always be. I think you can clarify that section of the bill with some wording. I'm not sure that we need the gas tax that's been mentioned many times. I would like to see some transfer of authority and clarify who is going to be financially responsible for this particular service and that particular service. Then I think probably we should talk about how we're going to generate the money.

The Chair: Thank you very much, Mr Phillips, and Mr King for appearing today in front of the committee.

Mr King: Thank you very much, Mr Chair and members of the committee. I wish you all the best in the holiday season that's just before you.

The Chair: Same to you, Mr King.

ONTARIO ASSOCIATION OF POLICE SERVICES BOARDS

The Chair: Would representatives from the Ontario Association of Police Services Boards please come forward. Good evening, gentlemen, and welcome to the standing committee on general government. You'll have half an hour tonight to make your presentation. You can use that time as you see fit. You may wish to leave some time at the end for responses to questions from the three caucuses. I would appreciate it if you both read your names into the record for the benefit of the members and for Hansard.

Mr Bruce Stewart: Thank you very much. This is Judge Allen, who is the honorary counsel of the association, and my name is Bruce Stewart. I'm legal counsel to the Ontario Association of Police Services Boards. I don't think we will require the half-hour in our submission. We'll try to be brief. We did place before the committee our written submission in this matter and we are only relating to two schedules in the submission. Indeed the first submission on the most interesting aspect of the bill, schedule M, is very brief.

We were very concerned at one time that in sections 209 and 210.4 there was a potential devolution of powers of police service boards that could have gone to upper- or lower-tier municipalities. Our concerns in that regard have been laid aside to some extent by the statement by the Honourable Al Leach and the Honourable Al Palladini, and I've attached that, where they've made it very clear, and we assume that's the government's intention therefore, that -- on page 1 of their letter of November 30 they say, and as you may know:

"Municipalities have been clear that they want more control over special purpose bodies," which police services boards are. "Our legislation will give you that control. The Solicitor General is launching a review of the structure and financing of policing and therefore police service boards will be exempt from municipal control."

We think that's very important. The reason that police services boards exist and the reason their composition is as it is, is the recognition that policing, being a sensitive matter, should not be subject to direct municipal political control. At one time, the police boards in this province -- they were then called police commissions -- were made up of not only elected municipal representatives, but also members of the judiciary and other provincial appointees. Now, as you all know, there are a majority of provincial appointees -- with members of the local municipalities in the co-terminus area -- on the board.

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It's desirable that at no time should there be majoritarian control by the local municipality, to retain the independence of policing. We accept the fiscal controls that are placed on us, and that, we believe, will continue, so we're pleased to see that statement. Subject to any questions the committee may have subsequently, I think we can leave schedule M confident that that statement by the government, of the two ministers, will be maintained.

What we basically wanted to address here tonight was the question of the criteria for the interest arbitrators under schedule Q. I believe you may have received similar representations from other bodies and therefore I will be brief in this.

The question of ability to pay is a very contentious one in any interest arbitration. We interpret what the government has intended here by this bill to mean that an arbitrator should not make an award if he does not think the police board or indeed any other public employer affected by schedule Q has the ability to pay.

The difficulty with applying that as it is written -- we think that's a perfectly legitimate intent, particularly at this time of our society; we laud that intent -- is that we don't think the way in which it's framed will allow that to be done appropriately by interest arbitrators.

Interest arbitrators have normally not considered that there was any limit on the ability to pay where the public sector employer had access to tax funds, and by that I mean had the ability to tax. While police boards don't have the ability to tax, municipalities carry the obligation to fund the awards which police boards receive. Therefore, since municipalities have the ability to tax, as long as the results of the award can be paid for by an increase in tax, even if it's in a subsequent period, the arbitrator will find that there's an ability to pay.

The former Prime Minister of Canada, Pierre Elliott Trudeau, once said that the only limit on the ability of a public employer to pay was a 100% tax rate, and I think that's right. No one's tried it yet, to go that far, but we think that's correct.

Therefore, if the government, in introducing this bill, believes it's simply stating, as it has in the criteria, that the ability to pay be considered, that's not enough because it has to be tied into some appreciation of the level of tax increase that is going to be taken into account. In the amended criteria, we suggest that it should be amplified by saying "without any increase in taxes." We would therefore recommend the committee consider that matter.

The second portion of the bill that we are concerned with also relates to the ability to pay, and that is that we would not want to see the ability to pay to be created by the arbitrator having the ability to, in effect, redirect funds from one level of service or one type of service being provided to another. We're very concerned that an arbitrator not come in and make judgements which the police board or the municipality is authorized and mandated to make, such as, there may be a competition between services, for example, fire services, as to who might have access to funds. We don't think it's appropriate for an arbitrator to insert himself into that issue. That's for the local politicians and the members of the police services board to sort out, not for the arbitrator.

Therefore, we're saying that the board of arbitration should not have the authority to determine the nature and level of services provided or to be provided by the employer.

The second aspect of that: I have appeared over the last 35 years in quite a number of interest arbitrations, and what has concerned me, particularly for the small police boards we have in this province, is the amount of time they can take. Some of these arbitrations are capable, of themselves, simply the cost of presentation, of putting a terrific strain on particularly the smaller police boards, which are the majority of the police boards in this province. We don't want to see an unnecessary litigation before the arbitrator as to the financial condition of the police board or the municipality.

We've suggested -- this is in paragraph 5 on page 2 of our submission -- that the board of arbitration would accept as final and conclusive any statement by the auditor or the senior financial officer of the police board as to the financial condition or record of the employer. We believe that would set aside a number of contentious issues which might not only take a lot of time, but be quite unnecessary to determine the issues before the arbitrator.

On page 3 of our submission, in paragraph 7, we are addressing the issue of public and private sector comparisons, only one of which is touched on in criterion number 4, which was that the arbitrator shall consider the comparability of other public sector occupations. We have no problem with that. We do have a problem with that being the only comparison being taken. Arbitrators already do that.

We think, first of all, that if you're going to put something in there, it should also cover the private sector, but more importantly, we suggest that may direct the arbitrator into some comparisons which will in the long term not support the first criterion of ability to pay. I think the committee should consider which is going to be pre-eminent of these criteria that must be considered: the question of comparability or the question of ability to pay.

I can assure you that no arbitrator now entering into a compensation arbitration would not consider other occupations. In the police area, there has been an ongoing issue in this province about whether police officers and firefighters should receive a similar or indeed the same wage, with the police officers saying they should receive more and the firefighters trying to keep up to them. That's the sort of leapfrogging that has allowed catch-up arguments, particularly on the part of firefighters but also from time to time by police associations.

Our recommendation is that the best thing to do is to delete that criterion. If that's not acceptable, our next recommendation would be to at least make it clear that the private sector wages be considered.

In paragraph 8 on page 4, we are raising what we think is perhaps one of the most important issues that might be considered by this committee on these criteria.

If there is a negotiated wage settlement within the municipality and, say, it's a CUPE local -- here in Metropolitan Toronto, for example, if the big CUPE locals 43 and 79 settle with the municipality of Metropolitan Toronto for this year and next year, why should the police association receive any more than that percentage increase, or indeed, you might ask, why should they receive less? We're saying any settlement that comes down of that nature, a substantial settlement, between the municipality and a bargaining agent like CUPE, should put a ceiling on what an arbitrator could do, because it's the same taxpayers in Metropolitan Toronto who are going to be asked to support the privately negotiated, freely negotiated settlement as well as the arbitration award. We would therefore recommend that be considered by the committee.

Subject to any questions you may have, that is the gist of our submission that we'd like you to consider, members.

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Mr Tascona: Thank you, Mr Stewart, for your submission. I have a couple questions to ask you. We've heard from municipalities, school boards and businesses, and they've requested that the mandatory criterion be strengthened. Your proposals are in line with these groups and they're excellent proposals, I would say.

But I have a couple of questions because we've heard from other groups, obviously that are opposed to ability to pay and seriously opposed to mandatory criterion. One of their arguments is that the independence of arbitrators will be affected by the mandatory criterion and that the awards will be skewed against employees. I'd just like to ask you what your view on that would be.

Mr Stewart: I don't see how the question of independence -- the key thing of course is that the arbitrator still has to balance these various criteria and he or she will still have the function, the task of determining how the mandatory criteria should apply in the case before him or her. Really, it's no different than having any rule of law. The rules of law are set out in statutes and courts are asked to apply those at any time, and that doesn't affect their independence.

Arbitrators have no greater right to expect freedom of control from the Legislature than do the courts. Obviously the courts must defer to the legislative intention, and we're asking that the legislative intention, which we think is clear in what the government has introduced here, be strengthened so that the arbitrators can apply it, but it would not affect their independence in any way.

Mr Tascona: With respect to the ceiling in criterion 8, I was interested in your comment with respect to pattern bargaining. In certain sectors, and I won't name them, that are subject to compulsory arbitration, you may find they'll have a particular arbitration in a particular city and hope to apply that throughout the rest of the province. Is there anything we can do to try to address that within the criterion?

Mr Stewart: The criterion you have asked me about, the ceiling on wage awards, would be one way of doing that, which concentrates on local and local criteria. In the example I gave, if the Canadian Union of Public Employees, which has not heretofore been noted for its ability or its readiness to roll over in bargaining and concede issues, were to settle in free collective bargaining with a municipality in Metropolitan Toronto, we think that's a pretty good standard for any interest arbitrator to accept.

As a matter of fact, in about the last three or four arbitrations affecting the municipality of Metropolitan Toronto, I can assure you that the Metropolitan Toronto Police Services Board has put forward that position. It has, however, not always been accepted, and the reason for that is that fire arbitration awards, for example, between the city of Scarborough, not the same employer -- an arbitration award providing the firefighter with a greater settlement has been the criterion for the settlement that the arbitrator has followed in making his or her award. This has been true at least the last two times and the argument has been made in the last three arbitrations. We think the much more compelling argument is what a union like CUPE, or name any union you want but CUPE is normally the one you find in municipal bargaining -- that would do quite a bit to avoid the pattern bargaining or catch-up bargaining.

In the police field, the standard is that the municipality of Metropolitan Toronto Police should be paid the highest, and therefore if anybody else in their settlements or awards, any other police force in Ontario or indeed in Canada, gets a higher award, then that becomes the standard that the police association, and I don't criticize them for saying this, wishes the arbitrator to follow. We have had awards in the distant past -- Montreal used to pay more -- where Montreal was followed as the appropriate pattern for an arbitrator looking at Metropolitan Toronto.

Mr Tascona: I recognize you are here on behalf of the police boards, but I know you have expertise in the school board sector and I'm curious to find out if you have any comments on that area. We heard from the trustees' association. They indicated this legislation should apply to the fact-finding process also. That was one of their suggestions. I just ask if you care to comment; I understand if you won't.

Mr Stewart: Actually, the fact-finder has fairly good criteria under that act now. Let's put it this way: It wouldn't bother me if it applied, but the fact-finder has no binding authority, and therefore the fact-finder's recommendation isn't binding on either party, therefore, I'm not as concerned with its impact. I think it would be much more to the point to just abolish fact-finding altogether.

Mr Crozier: Mr Stewart and Mr Allen, good evening. I'd like, first of all, if I could, to refer to your comments on your schedule M and your letter from the ministers regarding the exemption from municipal control.

It's my understanding, of course, since this is the piece of legislation that we're dealing with, that those exemptions would have to be dealt with under regulation. It's also my understanding that regulation, then, can be changed without coming to the Legislature for debate. Do you have any concern that, albeit you've received the assurance from the minister, or the ministers of the day -- the fact that it's not in legislation, as opposed to just regulation, they will be exempt?

Mr Stewart: Yes, there has been, there is concern about that; yes, definitely. That's one of the reasons we've brought the letter forward, so it can be noted in the record. I guess the next best thing would be to have a statement in the House. The next best thing would be to have an exemption to legislation.

Mr Crozier: That's why I wondered why you just simply didn't ask, in order to support their comments, that the legislation be amended then.

Mr Stewart: A question of priorities. We have no reason to disbelieve what the two ministers have stated here.

Mr Crozier: Nor do I. But what I'm saying is, it can be easily changed by the next minister. Okay, we won't dwell on that any longer.

Mr Justice H. Ward Allen: I'd just like to add some response to the honourable member's position. I share your concern, sir. I do not happen to be of the school that believes that regulation can overcome statute. I think the regulation has to coincide with, and cannot go beyond.

Mr Crozier: Thank you, sir. In your comments, you mentioned accountability. This is something that hasn't particularly been mentioned, but I think with your experience with police services boards -- and by the way, when I was mayor of my municipality, I like to feel that I was on the police services board for one of the finest police services in the province of Ontario, but it was only 25 members, mind you.

Mr Justice Allen: But it can still be an excellent service.

Mr Crozier: When it comes to accountability -- and I'm asking for your opinion, because at the time, there was myself as mayor and one member of council and three provincial appointees. I know often in discussion it came up in the municipality and particularly at budget time with council that of course the three non-elected, appointed members could outvote the two elected members. There was that question of accountability because of that decision. I'd just like your comments on that, if you wish.

Mr Stewart: I, of course, have to defer to your own experience: You had it; I didn't. As you know, under the Police Services Act now, if there is a dispute between the municipality and the majority of the police services board on the question of the estimates and their adequacy, it can be taken to the Ontario Civilian Commission on Police Services.

I think it's really quite a testimony to the cooperative nature, despite what the municipalities may be telling you, between municipalities and police boards that there have been very few applications. When I last researched the matter about six months ago, there were about three or four applications, under both the old Police Act, the old Ontario Police Commission, and under the present act, before this section 39 had even come into question.

So there haven't been very many disputes. One way or another, municipalities and police boards seem to have been able to work these matters out. I think it has been, and I'm sure it's your experience, if there has been initially a concern and a difference, there has been negotiation and they've avoided, then, the necessity to have a confrontation by going to the Ontario civilian commission. We hope that will continue to be the method of resolution.

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Mr Crozier: I hope so too. When you mention the Ontario civilian commission -- excuse me, I was going to say we were told by, I think, two fire services over the last couple of days that very few, percentage-wise, of even fire departments go to arbitration. I think it was somewhat in the area of 15%. It may be less for police services; I'm not sure. Can you tell me, does the commission that deals with the dispute between town council and the police services board have rules that are similar to what arbitration rules we're talking here? Even though it isn't arbitration, do they have any kind of similar guidelines?

Mr Stewart: No, they don't have guidelines on this issue, on the question of determining disputes between the municipality and the police board as to what the estimates should be, what funds should be provided. They really haven't developed guidelines because there have been so few cases. Frankly, when there has been any application -- I said to you there'd only been about three or four when I last looked, I should have said there have been a lot of applications, but they are resolved before a hearing because the Ontario civilian commission acts itself through its chair as a mediator, often, in these matters. So they try to resolve it without the necessity of having adjudication and they've been very successful.

Mr Silipo: Mr Stewart, nice to see you again; Justice Allen. I want to pursue a couple of points, starting with the last one that you were discussing with my Liberal colleague. Do you have any statistics you could share with us about the percentage of negotiations that end up before arbitrators in the police services?

Mr Stewart: I could easily get them. I don't have them here with me, but they wouldn't influence me very much, and I'll tell you why: It's the pattern bargaining Mr Tascona mentioned.

For example, if you were in a regional municipality, say, in the greater Toronto area and you have an arbitration award in a neighbouring municipality and you may have had a settlement in another neighbouring municipality, there has been a standard set, then, for both the police associations and the police boards to determine where they're likely to end up. That's the pattern bargaining, as I see it, that Mr Tascona was talking about in one aspect.

So the parties, then, really don't normally have to go to arbitration to be told once again what the award should be, because arbitrators are even perhaps worse than judges in that they tend, once one arbitrator -- with great respect -- makes a decision, they tend to regard it as close to Holy Grail and they're very disinclined to interfere with it. So once you have a few arbitrations around it, it obviates any necessity to go back --

Mr Silipo: So even though there may be a few in the whole context, you're saying the importance that's placed upon them is far greater than negotiated settlements?

Mr Stewart: Yes.

Mr Silipo: That's interesting. If you have any information that could show us that, I'd be quite interested in seeing it.

Mr Stewart: To that last point?

Mr Silipo: Yes.

Mr Stewart: Yes, I'll be glad to.

Mr Silipo: I wanted to just also pursue the essential point that I certainly take from what you're saying here under the arbitrations provisions, where you're in effect saying not only should ability to pay be considered, but indeed it should be applied, along with other criteria.

Mr Stewart: Yes.

Mr Silipo: I'm sure you're more than familiar with the argument on the other side that says even considering ability to pay equates ability to pay with willingness to pay. Indeed, what you're suggesting, it seems to me, would pretty much equate that. What would be left for an arbitrator to decide, other than to take whatever figure the employer said, "This is what we can pay," and say, "That's the award"?

Mr Stewart: First of all, the matter isn't that simple. For example, in this day and age, I think most of us are looking at productivity bargaining. That's what the private sector had for quite a little while, and the public sector is getting into that now.

Even if there were no new funds, even assuming that's the basis of your assumption, you could still have an association suggesting that a wage increase could be granted by reorganizing some of the way in which things are done or indeed by them being prepared to give up certain things to get a wage increase.

The productivity bargaining, for example, many aspects of policing now where the terrific cost of an officer going to court to give testimony, which is a huge cost to policing, very, very high premium payments -- for example, in Metropolitan Toronto here if an officer goes to court -- this is obviously on a day when he's not working as a police officer -- for 15 or 20 minutes, which is the norm, not normally are they there for long, he or she would get six hours pay for that short appearance. Obviously, there should be something to make up for the fact a person's had to come to court. Obviously, there is a minimum, but I think all of us would say that's a fairly generous payment.

There are lots of areas now in police contracts where I think with a restructuring of the compensation package, there can still be salary increases provided.

Mr Silipo: Again, correct me if I'm wrong, but it seems to me that those aren't necessarily the issues that drive questions to arbitration, are they? It tends to be the bottom line about how much of an increase, if any, there should be. I guess on that, I keep coming back to the point of if the legislation were to be written as you're suggesting, which says an arbitrator is not only to consider but also apply the ability to pay and the ability to pay is in effect to be determined again by what you're suggesting here, by whatever the employer says they are able to pay without any tax increase, without any other --

Mr Stewart: But you're assuming that police boards would approach this from the point of view of the employees getting nothing. That's not the way most employers I have dealt with would.

Mr Silipo: No, no, I'm not assuming that.

The Chair: Thank you, Mr Silipo. Time for the half-hour presentation has been exhausted. I'd like to thank the gentlemen for coming forward and presenting to our committee tonight.

CHRIS ARCHER

The Chair: May I please have Chris Archer come forward. Thank you for coming this evening before the standing committee on general government. You have half an hour tonight to make your presentation. You can use that half-hour as you see fit. You may want to leave some time at the end of your presentation for questions and responses from either of the caucuses. You can begin at any time.

Ms Chris Archer: My name is Chris Archer. I thought I was going to be speaking on health issues tonight and, much to my surprise, I'm in here. So this might be half an hour of improvisation, but I think it could prove useful to all of us, especially to me to speak this.

I'm very honoured to be here. This is a wonderful opportunity and I am glad there are public hearings being held about Bill 26, because this is, as you may have heard before, a bill that restructures government. The first thing that I wonder is, is this what this government was elected for?

I work in the public sector, and in this public sector I'm a social service worker and among the lowest paid of the lowest paid. But unfortunately, when any cutbacks happen, the association for which I work immediately starts thinking: "How can we save money? Well, let's cut back service."

The population for which I work is an extremely vulnerable population and we have been assured by the minister, David Tsubouchi, that no further cuts to this sector would happen.

The association I work for, the union of which I'm a member -- and I'm not speaking as a union member; I'd like to make that point perfectly clear right now -- all are wondering whether that can be believed. All of us are doubting his words, and that leads to a great deal of insecurity in the workplace.

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The association I work for has been trying to negotiate pay equity for it seems like 24 years, but let's call it eight, and we have not been able to come to an agreement about a plan. Much to the association's surprise, we found out that the government will no longer fund proxy pay equity.

Unfortunately, this affects the lowest paid in the service sector. I'm among the lowest paid in the service sector. I wonder what impact this is going to have upon (a) us as workers and (b) the client population? We're being asked to do more and more with less and less. We were being asked that before the government was elected, but now it is getting even worse.

The group home in which I work has two full-time counsellors, two full-time overnight awake counsellors, three part-time counsellors. Originally, the client population of this place was six individuals, and now it's gone up to seven. The staff loads have not increased but the staff workload certainly has. Again, and I'm afraid I'm going to be saying this quite frequently, we are being asked to do more and more with less and less.

All who work in this part of the public sector, dealing with the developmentally handicapped, care about the client population with whom we're working. We care about them very much. We wouldn't be doing this job if we didn't care. But we would like to know, how much money has this sector been overspending? We have not been told. We need more information about the financial picture than we are being given.

The association I work for is very reluctant to share financial information. Incidentally, there is one part of Bill 26 that I, as a citizen of Ontario, do agree with, and that's the disclosure of salaries of $100,000 and above. I think that is needed, because far too much money is being spent on executive-level salaries and not enough is being spent on servicing individuals in need. I'm not only speaking of the developmentally handicapped; I'm also speaking about psychiatric patients and corrections and whatever.

A lot of the moneys being spent in the public sector have gone on executive-level services. I'm sure they feel they earn every penny that they make, as do I, but the comparison between my salary and, say, the executive directors of the association I work for -- there's a very gross difference.

We were told that the executive director and the regional executive directors will not be taking salary cuts during the restructuring because they are not going to be demoted. I think we've had enough of that kind of cynicism.

I ask the question, why do parts of this bill seem to centralize power in cabinet if this is a government that does not believe that government should have that active a part in the social service sector, in health, in welfare, that this should be left up to private citizens and to the marketplace?

In one part, this bill has been useful because it started the citizens of Ontario debating what belongs in the marketplace and what does not. This is a debate that perhaps should have happened before and is happening now, and that is useful. But I am really frightened if this bill is passed as is. I have read it, and it seems to take several different parts of this government and throw them all together. It seems to give municipalities the power to charge taxes or user fees or any number of things, an open purse to do that, yet publicly this government is saying, "We're going to give you a tax cut." Citizens of Ontario are very used to hidden taxes, but we don't need any more out of our pockets. I have not had a pay raise in four years. That is where I'll leave that.

What was this government elected to do? Was this government elected to make all these changes, or has this government been elected because the citizens of Ontario didn't like what the previous government did, and was the previous government of Ontario elected because the citizens of Ontario didn't like what the previous government did, yadda, yadda, yadda?

I don't think this government has consulted with us enough. I have seen and read the Common Sense Revolution. I swore to myself before I walked into this room that I would not use the words "Common Sense Revolution." I apologize for that, but there you go. The Common Sense Revolution did not contain this bill. It may have contained the elements of this bill, but it certainly has not had it in mind, I don't think.

I think the citizens of Ontario would be more willing to receive cutbacks in government service if we were consulted about the cutbacks, where we think they should take place, what we think should be cut first.

As an aside, I was quite shocked that the funding for CJRT, which is a wonderful radio station, had been cut in total by this government. It's a real shame. It's a cultural loss to Toronto and to Ontario and to parts of the United States, if you listen to their fund-raising.

We would be willing to have cutbacks. I realize that the social contract of the previous government was an attempt to get this consultation process started. It was not a successful attempt, but it was a beginning. If this government could take any part of the previous government as a model, that might be a good place to start, or it may not, but all of us agree that financial responsibility is needed. We may have been living beyond our means for a while, but this government has really not proven that to us.

I read the Maclean's poll saying that citizens of Ontario and of Canada are in a state of despair and doom and gloom. I wonder if that is because we are being told by people in authority that things aren't working any more, and we're being told over and over and over again that we are broke. But what we are being informed about has not been proven to us. Before this government can go any further, it has to give us proof, because we are being asked to accept this government on a lot of faith, and it's a faith I can't extend.

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Incidentally, I read in the Toronto Star today that the Premier of Ontario, Mike Harris, said that in Ontario there is a culture of government dependency; I believe those were his words. As a taxpayer in Ontario, I was quite insulted. I take care of myself, and I'm quite proud of that fact. I help others privately as best I can, and I'm proud of that too. But the help I can give is quite limited because I don't make very much money. I'm not whining about that part.

But we used to have a culture that government would give -- in poli sci 101, Theories of the State, they told us that the state had the functions of accommodation with the status quo, which is a healthy economic climate, and accumulation, charging some taxes so that people could work and have health care, have a place to live, have enough to eat, so that more people could make money. As far as I know, that model is still valid.

It has been said that the Premier of Ontario is trying to find out what is good in this government and what is not working, but he seems to be doing so with an axe and just destroying everything in sight. Frankly, I'm frightened.

Since I cannot speak as a member of my union, even though I wish I could, and I cannot speak as a member of the organization for which I work, I am speaking as a private individual. You have to explain it to us. You have to explain why you need to have all these powers in cabinet, what the necessity of that is. You have claimed that we are spending $1 billion, I think the figure is, more a day than we take in, or something like that; you have to show us that. Proclaiming something from the rooftops does not prove it is going on.

I thank you for your time, and for your patience. I don't think you have any questions, but if you have any, please ask.

Mr Crozier: Ms Archer, I think you've done remarkably well for coming here and speaking on an impromptu basis, when you thought you were going to be speaking about health care.

I just have a couple of questions. You've mentioned that you work as a social worker. Do you work directly for the government? You've mentioned an association as well.

Ms Archer: No. I work for the public sector, not the public service. You know the difference between the public sector and the public service. I do not work for the government of Ontario, even though some of my salary, I think 55%, does come from the government.

Mr Crozier: You mentioned that there are two impacts that you think will be felt. You've explained to some extent the situation as it affects you, that you're being asked to do more with less. You also said it affects your clients. Can you give me some sense of how you feel it will affect your clients, what with the financial constraints you may have to work under.

Ms Archer: I work with developmentally handicapped people, adults, in a group home, and one of the concerns workers have working with developmentally handicapped people is violence from developmentally handicapped people. Now, I am not saying that developmentally handicapped people are all violent. I believe it's what they know how to do, it's what they've been taught how to do. But sometimes some with behavioural challenges need individual attention, and with two people on staff and seven clients, there is not enough attention that we can give at the time that it's needed, so situations build up and all of a sudden an emergency happens, and there you go.

Mr Crozier: Thank you very much for your comments.

Mr Silipo: Thank you, Ms Archer, for your presentation. A couple of points I just wanted to pursue a little bit: One of the points that you stressed a lot in your presentation was the lack of discussion and consultation. One of the arguments that we've heard repeatedly from the government members is that the consultation really happened during the election and that as a result of that they, by winning the election, have gained the right to in effect go ahead, do what they're doing here and proceed because they've got a mandate, and because the deficit is such a big problem, it has to be dealt with in this way, without any of this discussion taking place. What's your reaction to that?

Ms Archer: I've noticed people who vote for change often question that -- this government seems to have to define the kind of change that it believes people have voted for, without really finding out if these are the sorts of change that we have voted for. All of us do agree that the deficit can be a real problem, but I think we all need to be consulted before services get cut back. I don't think that this government's election has justified any pushing ahead without letting us know how, why, when.

If this can't come back -- if it does get restored, what form is it going to be restored in or could it be restored in? One of the major problems has been the tax cut, and now it seems to be getting put on the back burner. I wasn't looking forward to receiving a tax cut, but again, we need more consultation, and I don't think an election was a form of consultation. I know the previous government didn't do that, nor did the government before, and I think any government nowadays has to wonder whether or not it's going to be changed at the next election, but I wouldn't want to see a government that just caters to groups, interest groups, as this government calls them, for fear of being kicked out at the next election. That wouldn't be good either. We're all changing, and some parts of this bill are valid.

Mr Silipo: One of the other points that you made was your concern around the elimination of proxy pay equity, which, as you know, is a measure that allows some 100,000 women across the province in some of the lowest-paid job categories to eventually, albeit over a long period of time, reach a certain level of parity with whatever the male comparative job has been deemed to be. Can you give us some sense from your own understanding or experience about what eliminating that pay equity provision will mean for women in your sector?

Ms Archer: I'm only going to speak about the organization that I work for. I don't think that there's any will within the organization to create a form of pay equity. There's no will within the organization to raise salaries. I'm not speaking as a member of my union, and I'd like to make that quite clear right now, but I have been on the negotiation committee at least twice, and I didn't see any will on the part of the other side to look at sources of funding so that salaries could be raised. So I think that since the government is withdrawing from a proxy form of pay equity, it will not happen with my organization, and I'm very, very sorry about it, period.

Mr Young: Thank you very much for coming tonight. I appreciate you coming. I admire you very much for coming here alone. I'm kind of new at this too and you sometimes feel shy at the microphone, so I can imagine what it must be for someone to come as a delegation. And I admire what you do; it's a great public service. So I congratulate and thank you.

What I wanted to explain is that with regard to our debt, our government debt, which is close to $100 billion, and the interest we're paying on it, which is about $9 billion, if we don't get the debt under control and get our deficit, which is close to $9 billion, under control, we won't be able to afford our social safety net, of which you are a critical part.

The NDP had a job creation program they were going to spend $1 billion on which didn't work, and the Liberals had their job creation programs before. This bill, Bill 26, will be setting the stage for what I think is the largest job creation program in the history of Ontario. It will put $4 billion back into the economy over three years, roughly half of it in the first year, and that's the tax cut.

I wanted to ask you, at a personal level, wouldn't you appreciate having $700 or $800 more in your pocket over those years -- it would be more in the first year -- and wouldn't you put it back into the economy somehow?

Ms Archer: Oh, boy. When Hugh Segal was here in Toronto talking on CFRB to a phone-in show, I called in as a trade unionist. I'm not going to state the party that I work for sometimes, because I think you can gather that from the thrust of my remarks, but I told him that I would be donating my tax cut to the party of the previous government, so --

Mr Young: And that's a good point, because some people will get their tax cut and will actually give it to charity, those who can afford it, and if they're giving it direct to charity, there isn't the government in the middle, which is administrative cost etc, and most people will invest it back in the economy in one way or the other. We have a lot of optimism. We want to impart that optimism to the rest of Ontario, starting in this year, and that's what this bill is setting the stage for.

Ms Archer: If it happens, fine. I really can't answer that question until it happens. I cannot answer to my membership questions about pay equity until I can see the plan, until I know that the plan is going to occur, because otherwise I would be giving false promises to them. Right now it could be that the tax cut, which everyone means well about -- and I'm not saying that this government does not mean well; I think everyone means very, very well. But until it is there, until there is proof, it might turn out to be an empty promise. And speaking as someone who is active in a union, don't promise a salary raise, don't promise pay equity, don't promise anything until you know that the money is going to be there.

Mr Sampson: You talked at the beginning of your presentation about salary disclosure, and you thought that was a good idea. Just an interesting question to you: Do you think the $100,000 number's too high?

Ms Archer: No, I don't. I'm not going to say what the executive director of the association I work for makes, but it is within that range.

Mr Sampson: So it would do what we were hoping to do, which was to at least bring out into the public view what I guess was normally called the middle-tier and upper-tier management is making and encourage the public to come to some conclusions as to whether that's justified compensation.

Ms Archer: Yes, and to bring members of the organizations for which they are working to conclusions on whether or not that compensation is justified.

Mr Sampson: Yes, to help us deal with a very small component of the overall accountability issue.

Ms Archer: Yes. I think that's a really good idea. I agree with that.

The Chair: Thank you, Ms Archer, for coming forward and making a presentation to us tonight.

Ms Archer: Thank you very much, and again I want to emphasize I believe that this government means well.

Mr Crozier: They are just misguided.

The Chair: Our next witness has yet to appear in the building, so we'll have a 5-minute recess. Actually, I'll make it an 8-minute recess. That takes us to five after by my watch. If she's not here then, then we'll just go on to a 25-minute recess. So an 8-minute recess until five after.

The subcommittee recessed from 1955 to 2002.

ELIZABETH ROWLEY
ELIZABETH HILL

The Chair: Could Elizabeth Rowley please come forward. Just have a chair there. Good evening and welcome to the standing committee on general government. You'll have 28 minutes to present tonight. You can use those 28 minutes as you see fit. You may want to leave some time at the end of your presentation for question and response from the three caucuses. I would appreciate it, for the benefit of both the committee members and Hansard, if you'd read your names into the record at the beginning of your presentation.

Ms Elizabeth Rowley: Members of the committee, my name is Elizabeth Rowley. I'm a public school trustee in the borough of East York in ward 2, and I'm here on my own behalf and on behalf of my constituents. With me is Elizabeth Hill, who is a school board trustee in the city of York in ward 4, and she is also here on her own behalf. We don't have anything written but we'd like to make some verbal comments. Perhaps I'll start off and Mrs Hill will make her remarks in tandem with me and perhaps some afterwards, if that would be an agreeable way to proceed.

The Chair: Yes, it would be fine.

Ms Rowley: First of all, we'd like to thank Mr Alvin Curling for making these hearings possible, and the opposition parties in the House. I am very concerned, we are very concerned, about the contents of the bill on all fronts, both those sections having to do with health, which we understand are being heard by a portion of your committee in another room, and also in particular, of course, with respect to the provisions having to do with public education, both at the post-secondary level and at the public school level.

We are very concerned with the way the bill has been tabled and the process the government has chosen to deal with the bill. This is the most sweeping piece of legislation I have ever seen in my life. It affects virtually every aspect of government, every aspect of governing. It makes significant changes to the way that we, as citizens, will live in Ontario, and it makes sweeping changes to the way that you, as legislators, will legislate and will govern in Ontario. We think that the public is the loser in this new restructuring or rearrangement that is proposed in Bill 26. In fact, I think it is the very notion of parliamentary democracy which is under attack in Bill 26, and I should say off the top, on my own behalf, that I see no way of supporting any part of it.

I think the whole bill is flawed, largely because of the process but also because of the content. I think Ontarians will find themselves, if this bill is passed, in a situation where they'll have very little control over the way they will live in the new Ontario as it's restructured and very little control over government. All of the parties that campaigned in the last provincial election claimed they would open up government and open up the Legislature to the public, and I think Bill 26 goes miles and miles in the other direction. I think there are profound violations, furthermore, of civil and democratic rights and the rule of law.

I would point out to you, as I'm sure many other delegations before Mrs Hill and I have, that the proposals, for example, which would allow municipalities and school boards to be dissolved and created or recreated at the will of the cabinet or of the minister are unprecedented and unwarranted. The powers which allow for the closing of hospitals and massive changes to the way that health care is delivered in Ontario are unprecedented and unwarranted. The changes to universities and colleges, not only the financial changes that are anticipated in the bill and proposed by the bill, will transform our post-secondary education in Ontario into private schools for the wealthy and those who can afford the gigantic tuition that will surely result as a result of this legislation, again at taxpayers' expense.

Probably the committee is aware -- if not, I would like to make you aware -- that in Canada, universities and colleges, unlike in other countries, are primarily publicly supported. They're not private as they are in the United States. I think this bill will actually create or move very strongly in the direction of creating private universities that are publicly funded. Likewise, public education will move sharply towards a two-tier system, where parents who can afford it after the new round of cuts kicks in will opt to put their children into private schools, and those who can't will be stuck with the system that remains. I can tell you that professionals have approached me as a trustee, professionals who are ratepayers in the borough of East York and in ward 2, and said to me that if classes get any larger, they're going to pull their kids out; they have the money to do it and they will do it. Anyone who cares about public education in Ontario will hear those kinds of remarks and shiver and shake and be deeply concerned, as I am.

I'd like to come back to the overall consequences of the bill, because I think the logic of the bill as a whole impacts on education in the same way that it impacts on health. That is that the bill fits in very closely with the NAFTA agreement. In fact, what we are seeing is the level playing field being enacted in Ontario as it has to do with public education at the post-secondary and the secondary level, and likewise in health care -- we're going to see a situation where there is, as a result of this bill, a two-tiered system in education. Those who can afford it will leave, where there will be one system for the rich and one system for the rest.

I think Tomson Highway spoke very eloquently when he addressed a meeting recently of Metro council, when Metro council was anticipating the kinds of cuts that might come in this bill. He was speaking about what would happen to Metro Toronto if cuts in the neighbourhood of 25% each year were made. He described the city as being a bleak and a desolate place, full of unemployment, without any redeeming features, that nobody would want to visit, let alone live in. What he was describing, if you close your eyes and think about it, is what American cities already are. He could have spoken in the same way about public education and the dangers it faces as a result of the changes that are being anticipated in this bill.

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I think the bill also anticipates that as public funding is pulled out or provincial funding is pulled out of public education, corporations and private interests will move in. We've already seen, in Metropolitan Toronto, the learning partnerships. I would think the committee would agree -- I hope you would -- that there's no such thing as a free ride or a free lunch and that nobody gets something for nothing. We've had great difficulties in the public education system dealing with the question of partnerships. We do not want a situation where public education becomes dependent on the goodwill of private corporations whose main interest in education, as in any other field, is to develop a market, to see children, as we saw at the Kid Power conference here last winter, as a potential market, able to generate millions and billions of dollars in profits for corporations that have access to them and can make them sensitive to their brands. Such a case would be, for example, the Pepsi deal in Toronto and other kinds of partnerships.

The main partnership that we're concerned about is the partnership that takes place in Ontario classrooms every day between children and their teachers. It seems to us that the proposals in Bill 26 will undermine that most important partnership. And how is that? In the first place, if you withdraw the kinds of funds that you're proposing to withdraw -- $400 million this year on top of the cuts that have already been made over the last number of years by previous governments, equally shortsighted, in my view, or if perhaps not equally shortsighted, certainly shortsighted; this bill is beyond shortsighted -- we have a situation where taxpayers are going to be asked to pick up the slack, if you will.

On the one hand, the moneys that are withheld from school boards across the province as a result of this bill -- and I don't know how it will work out in Toronto. Certainly, the bill would indicate that if the government is interested in stripping teacher pensions and teacher gratuities, this might be the area where the government would move to remove a large amount of money from Metro by downloading that on to school boards or by eliminating it altogether. Then you have a situation where teachers will be asked to pay the biggest burden, on one side, by seeing their collective agreements stripped and their pensions stripped, and on the other side, taxpayers, ratepayers and tenants -- I don't mean commercial taxpayers; I mean ratepayers and tenants -- will be asked to pick it up.

What other choice do we have? We can go to our constituents as school board trustees and as boards, and we can say, "We are facing these huge cuts and the choice before you, as the people who elected us, is to opt for either whopping big tax increases," and we are talking about whopping big tax increases, not the kind of increases that we've seen to date, "or whopping big cuts in programs and whopping big increases in class sizes, the elimination of teachers and all kinds of money from the classroom, or the third choice is a combination of both."

For a government which claims to be interested in reducing the tax burden on ordinary Ontarians, this moves in exactly the opposite direction. I have to say in fairness that at least it's consistent with everything else in the bill. With all of the user fees, the tools that will be given to municipalities and the tools that will be given to school boards to implement user fees, to contract out, to privatize and so on, it's very clear to anyone who has access to the bill that the costs of this bill will far outstrip, many times outstrip, any savings that will come in the 30% tax rebates that are proposed by the government to take place in the spring in the next three years. We are seeing huge increases in taxes on individual ratepayers and tenants, and at the same time we are going to see the dismantling of public education. That, I would submit to you, is the only logical conclusion that one can draw from the financial proposals and the other proposals that are here.

We can only assume, or I can only assume, with this bill coming on the heels of the report of the Sweeney commission, that the government does intend to dismantle school boards across this province. Whether it's half of them of a third of them or all of them is unknown, but it's clear to me at least, as a school trustee, that that's the intent of the government and that such dismantling will take place, as it did with Mr Sweeney, without any consultation with the public as to whether they think that's a good idea or not a good idea, whether it be in Metropolitan Toronto or any other part of the province.

That, to me, is fundamentally undemocratic. If you don't ask the bride and groom if they want to get married and you just pull out a shotgun, that's undemocratic. That's imposed, and that, to me, makes it flawed from the beginning. So when you combine the two things together, the cuts that are anticipated and the restructuring of school boards or perhaps the complete elimination of them, you have a disaster, in my view.

In conclusion, I'll call on Elizabeth Hill now to make some remarks.

Mrs Elizabeth Hill: It's very difficult to separate out the specifics of Bill 26 in this issue because this bill, as I see it, is really a tool to give the Ontario government much greater powers, powers to the cabinet and to the ministers. So it's not only the bill and the items in the bill; they're so all-encompassing that it affects many other things.

I live in the city of York, which, you may have heard, is a small part of Metro Toronto with a very high number of immigrant families, a very high number of low-income families, a high number of single parents, a high number of seniors and so on. It's a very needy community. So the effects of the possibilities that come in under Bill 26 can be extremely devastating.

Since I deal with the public school system and I see the schools and I talk to the parents, I'm very aware of some of the day-to-day concerns that people had. We all know about hungry children in the schools.

The issue of the cuts and how it has affected education: I know the mini-budget and so on is separate from Bill 26, but the aspects of Bill 26 further compound and add to the difficulties of school boards. Already we see many partnerships between business and school boards, which I find quite scary. When you see in a school, in the public hallway, advertisements for banks, we're giving our children mixed messages. Children are being taught to listen to teachers, to listen to what they're saying and to learn what they're saying; at the same time there are advertisements. We want children to be critical thinkers, but we're giving them mixed messages. If they begin to become critical and cynical about the advertisements that are becoming more and more commercialization -- and I think that's what frightening down the road -- that scepticism may carry over to what the teachers are telling them about mathematics and so on.

We have, in one of my schools in particular, a literacy program which has been extremely helpful for children who have difficulty in reading, and yet the reduction of teachers and the budget cuts are threatening that program. I'm already receiving letters from parents telling how much of a difference this program has made in the lives of their children, and if it's cut, it will place them in great jeopardy. I think that what you save -- it's an example that I want to say to the committee, it's penny wise and pound foolish. The pennies that you save at the lower end are going to cost multi-dollars at the other end, when we have older students who need remedial, who have behavioral difficulties because of academic problems.

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One of the surveys that I often have talked about in my community is a survey done by OISE, the Ontario Institute for Studies in Education, a survey of opinion on taxes. The one that they conducted that came out last fall showed that while many people are opposed to increased taxes, when it came to the issue of education it was reversed and the majority would favour paying more for a quality education. The only exception was the board of trade and corporations and it's these very corporations which I feel would benefit by the lack of funding, the lack of local autonomy and power, the lack of democratic -- the power of democratically elected people to represent their constituents. They will be the beneficiaries because schools that are lacking funds will be forced to put impossible taxes or to turn to partnerships which would open the doors to some of the difficulties that we've seen happening in the United States, and I can't go into all the detail there.

I think that's the main point I wanted to make at this time.

Ms Rowley: In conclusion, this government, when it has spoken about public education, particularly public education in Metro Toronto, has spoken about a crisis of overspending. But in fact, the reality is that there isn't a crisis of overspending; there is a crisis of revenue. All of the boards in Metro Toronto have been in the situation over the past number of years, the past five years, where large corporations have been appealing their property and business taxes and we have lost $400 million from public education.

We have stripped back in every possible area that there is to strip back. If there was any fat in the system, I assure you, Mr Chairman, there is no fat left. What you will do by bringing in the kinds of cuts that are anticipated in Bill 26 is bring about a two-tiered system of education and the dismantling of public education. That's what it's about.

If you are looking for ways to find revenues to fund public education, I would suggest that you go back to the Fair Tax Commission report, which proposed that education should no longer be funded from the property tax and should be funded out of general revenues raised from a tax that would be a provincial tax, that would be reworked and reformed on the basis of ability to pay.

I can tell you that my constituents are bloody furious about the bank statements that have come out, showing that Canadian banks have earned more than -- "earned" is not the word -- have scooped off more than $5 billion in the last year alone, while 44 bank branches have all appealed their property taxes and their school taxes in Metropolitan Toronto. They are furious. If you are looking for money, look there.

I can tell you the public will agree and I hope the committee would agree, that money is essential for public education to work. If you want to continue to see Canada as a world-class country, the number one country that people want to live in, then you're going to have to have the kind of public infrastructure, including public education, which continues to be a well-funded, superlative, excellent system of universal, public, quality education. I urge you to urge the government to put this bill on the shelf and to start looking at ways to adequately fund our social programs and certainly public education.

The Chair: We have two minutes per caucus for questions, starting with Mr Silipo.

Mr Silipo: Thank you very much for the presentation. You've talked a lot about some of the background behind this bill, as well as some of the particular directions that the bill takes the province in. I just wanted to make a brief comment and ask you to respond.

One of the things we certainly are seeing is, in addition to a series of broken promises by the government -- no user fees for health care and we have fees in health care; no cuts to classroom education and $400 million -- we don't see how those cuts are going to come about without affecting the classroom; various other things that I could go on listing but won't because the time isn't there.

It seems to me that at one level it might almost be understandable -- not acceptable, but understandable -- if all of that was being done for the sake of reducing the deficit, but what is frightening is to see that what is driving the agenda is primarily the tax cut and the fact that the largest portion of money that the government is cutting is going to go towards tax cuts which, as you said, then are going to be translated at the local level into likely increases in taxes in a variety of ways, whether it's user fees or increases in property taxes or, alternatively, a real drastic cut in services.

I guess the only question I have on that is, are people beginning to understand that out there?

Ms Rowley: Oh, I think so. I can tell you about the meetings that we held on the Sweeney report in East York, and the meetings that we held were to garner public opinion, to present the facts and to see what people thought. The one thing that electrified people was the proposal in Sweeney to provincially pool commercial and industrial assessment. In Metro Toronto that means $400 million will be lifted out. It means a 40% tax increase or a 20% residential tax increase or a 20% cut in services and people were outraged.

In the meetings that I held, that was the one thing that woke everybody up. They suddenly realized that this report is not primarily about amalgamation, which some people feel would be a good thing: others feel it wouldn't be a good thing. But when they saw what the consequences to Johnny in the classroom and Sally at school were going to be, I was mobbed by people asking me: "What can I do? Can I get a petition? Can I sign? Can I phone somebody? Can I do something?"

I would suggest, Mr Silipo, that when the public becomes aware of what the contents of Bill 26 will be with respect to public education and, I would think, municipalities and public health, the Boston Tea Party will look like a picnic.

Mr Young: Thanks for coming to make your presentation. With regard to your comments on education, I would like to respond a little bit and then ask you a question. You talked about gigantic tuitions. Even with the tuition increases, if the universities go to the maximum on the 10% increase, it'll still only be in the $2,600 range and college tuitions will be in the $1,300 range. I would submit that it's just a tremendous value and it's available because Ontario universities have about the highest access rate of any jurisdiction in North America; that is, the number of high school students who graduate who want to go to university who can go. So I don't see gigantic tuitions.

Now, on the other hand, in the States the same tuition would be anywhere from $15,000 to $25,000 a year. So I think we're doing very well and we're going to work hard to make sure that universities and colleges are still accessible.

With regard to the school boards though, because that's your area of expertise, we have 168 school boards in Ontario. We spend about $1.3 billion a year on custodial service, total. We spend about $560 million a year on preparation time. So we think there is a lot of room to save money without hurting the children in the class and to keep teachers and children together in the classroom.

I would like to ask your comments on that, as well as you said there's nothing in Bill 26 that you like. None of the changes you talked about in education are in Bill 26. I don't know if you know that.

Ms Rowley: Yes, I do.

Mr Young: They're not in Bill 26. But there is something that's in Bill 26, which is the Public Sector Salary Disclosure Act, which states that anybody who makes $100,000 a year or over should have their salaries published and I wondered how you feel about that.

Mrs Hill: I have no qualms with having large salaries published. I think that would be a good thing. Actually in our board's financial highlights not the specific names but the range of salaries at the supervisor level are shown. The only fear I have is that I would hope that that wouldn't become like a whipsaw so that people who see that will want to be increased to be at the level that big corporate managers are. That's one fear I have.

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On the issue that you mentioned about custodial service and preparation time, I think one thing -- you can't look at everything in dollars and cents and just separate them out that way like you're buying laundry soap or something. There's a lot more. Do you know, in our schools all of the staff are a family? The caretakers are part of the school. They're trusted, they do a job, they care, they're involved, they come out to the special events. It's not something that you can just say, "Well, gee, we'll get someone who'll do it for half the cost." You only get what you pay for and you're not going to get --

The Chair: Thank you. Sorry to interrupt, but we have to get into Mr Colle's time for questioning.

Mrs Hill: I didn't get a chance to deal with preparation time.

Mr Colle: Mr Chairman, I should mention too, something very --

Ms Rowley: Could we just answer some of the --

The Chair: No, we only have limited time.

Ms Rowley: I'm sorry.

Mr Colle: You're taking my time.

The Chair: Each presenter has a certain amount of time.

Ms Rowley: Okay. Sorry.

Mr Colle: Something very close to my heart is that my father was one of these unnecessary service providers in the schools for 18 years of his life. He was a custodial caregiver.

Mrs Hill: So was mine.

Mr Colle: I think he created a good atmosphere in the school. He knew the kids as well as the teachers. He used to talk to the parents about everything from health problems to discipline problems. He made sure the ice was scraped from the sidewalks. He kept the school clean, just as he would his own home. So I think we've got to go beyond just the dollars and cents, as the deputants said.

There are people who really feel being part of the school -- even though they are so-called lowly custodial givers or caretakers, they're important in a school and sometimes they're as important as teachers in fact for the care they take.

But the comment I wanted to make, after defending my father's life as a caretaker, is that the act itself has a very interesting provision. It talks about public participation. I don't know if you realize this, if trustees realize this, but under this act a municipality can unilaterally dissolve a board of education.

Ms Rowley: Yes.

Mr Colle: Just by a bylaw, a show of hands in municipal council, and I'm sure a lot of municipal councils would love to assume more power in their hands and abolish a school board. What do you think about local councillors all of a sudden assuming this extra duty perhaps of running our school system by just one vote in a council meeting?

Mrs Hill: I think anyone who would put that idea forward doesn't have any concept of what school boards are and what education is all about, because the councillors are very busy; full-time jobs, better paid than trustees and they are constantly busy with their -- well, you were a councillor, Mr Colle, yourself. To add on education, as if children, as if our future is something that you can tag on to the bottom of an agenda somewhere, is ludicrous.

I've been a trustee for seven years. I spend days going over our agendas and preparing, and the work of a trustee is quite complex. You have to understand provincial legislation. Educationally -- you're not a teacher, but you have to understand what is being talked about at the meetings. You have to be in touch with the community, in touch with the schools. It's not something that could be added to somebody else's portfolio.

The Chair: Thank you very much and your time for your presentation --

Ms Rowley: Could I make --

The Chair: -- I'm sorry -- is actually a little bit beyond being exhausted. I want to thank you for coming today to appear before the committee.

Ms Rowley: Thank you. May I just note one thing though and that is that Mr Young's observations were quite inaccurate? They're not factual.

The Chair: No. I'm sorry. Again the time for your presentation is over. You may want to talk to him about that perhaps outside or through his office or in another manner, but we have to strictly adhere to the 30-minute time limit with all of our witnesses.

Ms Rowley: Surely it is important to be factual, however. The material that I indicated was in the bill is in the bill --

The Chair: I'm sorry, ma'am. Cut the mike, please.

Mrs Hill: Thank you very much.

The Chair: Thank you.

TOWN OF PENETANGUISHENE

The Chair: Could I please have Mayor Bob Klug from the town of Penetanguishene come forward. Good evening and welcome to the standing committee on general government. You have 30 minutes this evening to make your presentation. You may use that time as you see fit. You may decide to leave some time at the end of your presentation to entertain questions and responses from the caucuses. I'd appreciate it if you'd both read your names and your affiliations into the record for the benefit of both the committee and Hansard.

Mr Bob Klug: My name is Bob Klug. I'm the mayor of the town of Penetanguishene.

Mr George Vadeboncoeur: My name is George Vadeboncoeur. I'm the CAO, town clerk, for the town of Penetanguishene.

Mr Klug: I would like to thank you very much for the opportunity to address you tonight. I realize it's been a hectic day for you, and I'm sure you'd all like to be home with your families. I know you've been very busy listening to presentations on Bill 26, so my comments will be very brief.

I'm here today on behalf of council to present the town of Penetanguishene's position on schedule K amendments to the Municipal Freedom of Information and Protection of Privacy Act. The town wholeheartedly supports the changes proposed under Bill 26 to the act. However, I want to state at the beginning that our position should in no way be construed that the town is against people having open access to information from a municipality. On the contrary, we are open and support the principle of open access. Most of the requests for information to our town are handled over the counter, and the public is quite pleased with the level of service. What we are opposed to is the abuse of the right to information granted under the act that occurs in our town and in other Ontario municipalities.

The town of Penetanguishene has a population of approximately 7,000 people on the shores of Georgian Bay, almost two hours by car directly north of Toronto. We have a full-time staff complement of 40 people, including 10 administrative staff. So far this year we have received 140 freedom of information requests, 137 from one individual. In 1994, we only received eight, as the result of an agreement put in place by the freedom of information commission appeals office between the town and the main requester, where information was sought over the counter rather than using the FOI act.

In 1993 we received 99 requests, in 1992 we received 165 requests, and in 1991 we received 442, which we condensed down to 47 requests. For comparative purposes, the city of Barrie, the next largest city to us, with a population of over 70,000 people, 10 times the size of Penetanguishene, had received 35 requests in 1995 to date; in 1994, 73; in 1993, 71; in 1992, 11; in 1991, 37. Our immediate neighbours have had even fewer. Tay township, for example, has had no requests in 1995. As you can no doubt appreciate, we have had a problem in Penetanguishene for a number of years.

As the head of the corporation for the purpose of freedom of information, I personally deal with each of the requests submitted to the town of Penetanguishene. The town's deputy clerk is the coordinator under the act, doing the research and preparing the responses. So far this year, the town has used over one month of staff time to respond to the 140 requests for information we have received, at a cost of over $5,000 to the town, not to mention the cost of my deputy clerk's lost time and his work that could have been done in other areas.

Located in the town of Penetanguishene is the Penetanguishene Mental Health Centre, which includes the Oak Ridge Psychiatric Hospital for the Criminally Insane. There is a patient in the hospital who takes pride in filing freedom of information requests. Although his activity in Penetanguishene has fallen off this past year, earlier newspaper articles had reported that he had put in over 2,500 requests as of 1992. In our view, it is these types of requests, and the kind we have been receiving from the same requester for the last few years, that are considered the frivolous and vexatious requests that the proposed amendments to the Municipal Freedom of Information and Protection of Privacy Act are trying to address.

Our member of provincial Parliament, the Honourable Al McLean, has been very helpful in trying to deal with the problem of frivolous requests. He introduced a private member's bill a number of years ago to institute some of the changes now proposed, but unfortunately the bill was never brought forward.

In 1994, we submitted a letter to the standing committee on the Legislative Assembly holding public hearings on the Municipal Freedom of Information and Protection of Privacy Act. The act was up for review, and the town thought this would be an excellent opportunity for change to be introduced. We made our submission, and no changes resulted.

We have tried various means to try and deal with the requests as over-the-counter requests, but to no avail. As long as the act is in place with its 30-day response requirement, advising a requester that you can't deal with the request immediately because of our other commitments does not work. Our own work is left behind. The person immediately files a FOI request and is assured they will receive a response within 30 days.

Recently, the freedom of information commission ruled on the appeal of a London Police Service decision that a series of requests to the police service were an abuse of process. When we called the commission, they advised us that this decision was made based on the specific circumstances of the London requests.

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The town of Penetanguishene is of the view that the principle of abuse of process established by the commission should be included with the amendments to the act. Whether a paragraph 4(1)(c) is added, or it is included with the regulations that give guidance to the head of a municipality in determining if a request for information is vexatious, it does not matter. It is important that the principle be included as a guide to municipalities.

We would also recommend that section 23 of the bill, clause 45(1)(a) of the act, be amended. We recommend that the words "or a portion thereof" be added after the word "hour" so that the paragraph reads, "the costs of every hour or a portion thereof of manual search required to locate a record." This amendment would make the application of fees consistent with the current act and make it clear that municipalities may charge fees for a portion of an hour used to locate a record.

We support the discretion provided the head of council to waive fees in cases of financial hardship or where the release will benefit health or safety. However, we would support the imposition of a minimum fee of $5, for example, to help cover the costs of preparing the record. For requests of personal information, we would recommend that only the minimal fee be required. If a request were refused, for whatever grounds, we would recommend that the fees be refunded but that the applicant be charged a minimal fee if he/she appeals the decision to the freedom of information commission. We feel this is consistent with the user-pay approach we and other municipalities are putting in place and is fair.

In conclusion, we are a small municipality that has done everything in its power to try and deal with requests for information from the public in an open and fair manner. We have been subject to abuse under the Municipal Freedom of Information and Protection of Privacy Act, and we can no longer afford to tolerate it. Council members and taxpayers are concerned that a senior member of the town's staff spends in excess of one month of working time dealing with freedom of information requests that are frivolous and vexatious. We have tried to have the act changed in the past, and we have asked for assistance from the freedom of information commission, but to no avail.

We commend the government for finally making the changes that municipalities and related boards and commissions have been asking for for years. We hope you will consider the amendments we have put forward as improvements to the proposed legislation. We thank you for your time, and we would be pleased to answer any questions you might have of us.

The Chair: We have six minutes per caucus for questions. We'll lead off with the government caucus.

Mr Tascona: I thank you for your presentation. As the member for Simcoe Centre, Barrie, I'm a little astounded by the figures for information requests with Barrie versus Penetang, when your population is 10 times smaller and you had 10 times the requests. It's just amazing.

I am interested in the approach the government is taking with respect to the requests for information and the fee. As you've indicated, we are acting on the legislative standing committee's recommendations.

Your abuse of process request is certainly important. Obviously, it's been applied by the Information and Privacy Commissioner where there are an excessive number of requests and appeals collectively. I certainly believe that should be in the act, but perhaps more at the commissioner level if you're dealing with these as appeals. We've tried to front-end the process to allow municipalities to deal with the requests by refusing at the initial stage where it's frivolous or vexatious, and put together a process that has to be followed in terms of a written request, a fee and the type of information being requested.

The approach suggested by the commissioner was back-ended again, where that person would decide. But the problem is that you have to dig out the information, and that's where the cost comes into a situation like that.

I'm just wondering if you are comfortable with the approach the government's taking with respect to front-ending the decision about whether it's frivolous or vexatious.

Mr Klug: I would understand that the government of Ontario is giving or empowering the municipalities more freedom of discretion. We are grown-up children of the province, and if you put the right criteria together, we could save a lot of the workload the commission would have to do, because we would use that in reviewing all the requests and therefore we could handle them at the front end. But you also have to protect us in some area, and it's your legislation that will protect us from the abuse of process. We look forward to that remaining in there.

Mr Tascona: I think it's already in the jurisprudence of the IPC in terms of how to deal with this abuse of process, but I welcome the suggestion on that end.

With respect to the fees, I see you're looking at the cost of every hour or part thereof, but you're looking at a minimum fee, and you've put down $5. Are there other areas you'd be looking for minimum fees in terms of what you would have to do in dealing with the requests that come to you?

Mr Klug: We do log our time for how we handle a request and we follow the legislation that's in place to, first of all, collect the information that has to be collected, then reviewing the legislation to determine whether it meets the criteria for being able to be released. My employee does all the legwork and I get the credit, I suppose, if you want to call it credit. I have to review the requester's request. With the information in front of us, my employee and I sit and review it and decide that yes, we can release it, or no we can't.

When you are dealing with one, it's fine, but when you get 12 to 15 in one day, the work he was supposed to do that day is now put off. In the small municipalities, it's a very difficult process. Maybe the city of Barrie could handle it; it's got a lot more employees. But that's the problem.

Mr Tascona: In a situation like that, where you have 12 requests in one day by the same individual for trivial information, that certainly would be a frivolous or vexatious request and you could refuse.

Mr Klug: The fee would -- I always believe that if it hits the pocketbook, he's probably going to be a little more conscious about making sure he knows what he's looking for, that he's leading towards something. I have no problem with giving information; the democratic right is that they should have that information. But it's the number, and quite often there's no follow-up, once the information is out there, where he's going with it.

Mr Colle: It's ironic that on one hand, in Bill 26 this government is giving itself more powers to get into personal medical files and access personal, confidential medical information, yet in this situation you're applauding them for restricting the public's right to find out what the government is doing at the municipal level, what the government is doing at the provincial level.

The astonishing thing is that you're saying essentially most of these requests are coming from someone in a mental institution --

Mr Klug: No.

Mr Colle: -- and because of these requests, from someone who's obviously mentally unstable, you support this government making this unilateral, sweeping change to the public's right to know right across this province. You yourself have stated that the city of Barrie, for instance, doesn't have a serious problem because perhaps it doesn't have an individual like you have. It's unfortunate that --

Mr Klug: Excuse me. You're using my time and I don't think you really have understood the presentation.

Mr Colle: I have the floor. You would expose the rest of Ontario to this lack of access to information that is theirs, is public information. Sure, it's messy and sometimes it's costly, but what price do you put on the public's right to know? Perhaps you have a certain price threshold, but I ask you, what is the price of the public's right to know? Why will you deny them this right to know right across this province? It's because you've got some person who's very, very sick in your municipality who's abusing the system.

Why not deal with that individual who's abusing the system rather than give these unbelievable restrictions to the public's right to get their own information and put fees on them and make them pay for manual search, preparing of records for disclosure, computer and other costs incurred, locating, retrieving. What's going to happen to a person who doesn't have money who wants to get information?

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The last question I'll ask you is, what if the person coming to a municipality wants public information about the head of your municipality and the head of the municipality is in control of who has the right to access information? Isn't there a bit of conflict of interest there for that head to have that control?

Mr Klug: May I?

Mr Colle: Yes.

Mr Klug: I don't think you understood the gist of my presentation. The one person we talked about from the mental institution has not been the problem, although he was in the past. The document I have left with you also explains, through some news clippings, that this gentleman, who wasn't the main thrust of my document, has in the past been able to access the actual blueprints of the maximum security.

I'm not denying the public's right to access information. I've always been a liberal-thinking mayor who would say that if someone financially were unable to pay the fee, I would waive the fee. What I'm asking for is that the abuse of process where one person can now almost have my employee dance like a puppet on a string -- that we put something in place that will protect us, if it has to be a fee-for-service, from any one person from overpowering us.

Mr Colle: But what about the conflict that you will decide what fee and when to waive it. Isn't that a bit of a conflict of interest when you have the public asking for information on perhaps what you spent your money on in expense accounts as a councillor or as a mayor? When they come to you and you've got to make that decision, how are you going to make that decision about whether to waive a fee in all true objectivity?

Mr Klug: Perhaps there's a case where, if someone felt that the mayor was abusing the process of his leadership, the commission would have to come in and become the arbitrator, or certainly someone who would have a clearer picture, who doesn't have a conflict of interest in thinking he has some secret reason to denying someone information. Perhaps you are not as closely attached to the problem as I am in my municipality.

Mr Colle: Maybe that's the problem. You've been too closely attached to it to see that what this bill is doing is holus bolus disallowing the public's right to their information, which they pay for, in every city and town across Ontario and in every government ministry because you've got some nut case who's driving you crazy. You want to do this to the people of Ontario because you've got a problem.

Mr Klug: I'm sorry. That's hogwash.

Mr Silipo: I'm curious to understand a little better the situation you're experiencing because there's something I haven't quite understood in what you said. I think it's fair to say -- and correct me if I'm wrong -- that the essence of the problem you're facing does come from one individual --

Mr Klug: For the most part.

Mr Silipo: -- in your view submitting an inordinate number of requests.

Could you explain the difference between 1994 and 1995? In 1994, you indicated there was some agreement reached which reduced the number of requests from that individual. I'm curious about what happened then versus what's happened in 1995, and also why you haven't been able to use the abuse of process approach to deal with that, if that's what you believe it is. When the Information and Privacy Commissioner was here, he made the point very strongly to us that there was a process in place to deal with exactly this type of situation that you're describing, so I'm puzzled about why it hasn't been followed in this instance.

Mr Klug: When we started to realize that a member of my employ was actually being taken away from us to handle the requests, we thought we should get some information from the commission. We had them up and we actually had the primary requester sit with us and develop an understanding. We can handle business equally well over the counter, because we're not a closed shop. We're open to the public. We have cameras in our chambers, and everything we do other than very sensitive personnel matters or financial or purchases are out there. We do not deny them that information.

For a while, the idea of working over the counter was handled well, but for some reason we have offended him and he uses the big club. The big club is the FOI, because he knows he can make you dance with it. You have 30 days. We tried in the last month to basically postpone, defer, so now many of the requests are sitting on the commissioner's table. We wanted to show them the mass of files we have at our counter, that they must have on their counter, to say, "This community has a problem." When he feels he was not satisfied, that he was in some way not treated the way he would like to be, he then falls into the FOI.

Mr Silipo: I have a concern about what you're describing. I don't for a second make a judgement upon this particular situation and what is happening. I take your description of it at face value and I'm not arguing in the least with that. But I do have a concern that if there are problems like this -- and we know there are, there are issues. I can tell you there was a private member's bill in the Legislature a couple of weeks ago on this very issue, and I supported a change in the legislation to deal with requests that were vexatious. But I have concerns about the sweeping nature of the amendments we have in front of us, because I agree with the commissioner when he says it is going far beyond what we need to control these very limited situations of abuse.

Your main concern is around limiting these abuses, is that fair to say? If there's a less intrusive way of doing that than putting in legislation that seems to limit the rights of people right across the province in a significant way, wouldn't that be more sensible?

Mr Klug: We looked at a fee for service as one aspect of it, at perhaps numbering the number of requests per month per applicant -- any means that would allow my employee to do some of the work that's now amassing on this side because he's over here dealing with this pile. The fee, because everyone's sensitive to the dollar, would be a mechanism that would certainly affect someone who was using the volume of requests. As head of council, if someone did come to me and didn't have the $5, if it happened to be $5 that was set, we are understanding people and that would be waived.

Mr Silipo: I'd just say that I hope you would understand the concern some of us are expressing, which is not contrary to what you're saying in terms of the need to limit abuse of the process and of the right to access information, but we feel we need to make sure that along with that there is a also a continuing ability of the public to get information about themselves and about their governments.

Mr Klug: I wholeheartedly agree, and I very much underline that sentiment of the democratic right.

The Chair: Thank you very much, gentlemen, for coming in tonight and making your presentation to our committee.

Mr Klug: I thank you, and I wish you all a very Merry Christmas and a Happy New Year.

The Chair: And to you too.

We're going to adjourn for the evening until tomorrow at 9 o'clock in committee room 1. First, Mr Hardeman has a point of clarification to make.

Mr Hardeman: Earlier, when the regional chair of York was here making a presentation, he discussed a section of the act as to a bylaw that would be in effect and the changing of powers. At the end of it I read part of the act and said that once it was in place it was always in place. To that section that would be true, but there is another section of the act that does allow a process for that to be reversed by the consenting municipalities.

The Chair: Thank you for that clarification, Mr Hardeman.

Mr Hardeman: Incidentally, Mr Chairman, I did make that clear to Mr King before he left, so he is aware of that too.

The Chair: Thank you. Adjourned till tomorrow at 9 am.

The subcommittee adjourned at 2100.