The House resumed at 8 p.m.
ONTARIO LOAN ACT (CONTINUED)
Resuming the adjourned debate on the motion for second reading of Bill 111, An Act to authorize the Raising of Money on the Credit of the Consolidated Revenue Fund.
Mr. Speaker: The member for Rainy River.
Mr. T. P. Reid: Thank you, Mr. Speaker --
Hon. Mr. Ashe: On a point, Mr. Speaker: There is one member of the third party and now, or lately, three members of the official opposition; it is disgusting.
Mr. Ruston: Do you want to call for a quorum?
Mr. Speaker: The member for Rainy River has the floor. Proceed, please.
Mr. Foulds: Mr. Speaker, on the point, whatever it was, that you allowed the Minister of Revenue (Mr. Ashe) --
Interjection.
Mr. Foulds: Does the minister want to call for a quorum? He can go ahead.
Hon. Mr. Ashe: No. We have enough members here to make up the quorum.
Mr. Ruston: Mr. Speaker, the direction by the Premier (Mr. Davis) has got more of the government members in now.
Mr. Speaker: Order. The member for Rainy River.
Mr. T. P. Reid: Thank you, Mr. Speaker. I am reminded of one of those folk song groups that used to say, "The crowd, while not large, was enthusiastic."
Mr. Piché: There are 18, two and one.
Mr. T. P. Reid: We go for quality on this side, not quantity. I refer to the three members on the back benches over there.
Interjections.
Mr. Peterson: Take your shoes off and count again, René.
Mr. Speaker: I would rather hear the member go for debate.
Mr. T. P. Reid: I do not know whether I should do this by way of a point of order or just include it in my speech. I will leave that decision up to you, Mr. Speaker. It does relate to Bill 111, I can assure you, as have the previous five hours of my remarks.
The principle of Bill 111 is to give the Treasurer, Frank Miller, the favourite son from Muskoka, number three in the Tory leadership campaign -- number two, he tells me --
Mr. Speaker: May I remind the member of a ruling I made earlier, that we are to refer to the members by riding?
Mr. T. P. Reid: I am sorry; I thought I had. The member for Muskoka, the favourite son --
Mr Foulds: I thought that was Bobby Orr.
Mr. T. P. Reid: Bobby Orr could never stickhandle the way this Treasurer is trying to do --
Hon. F. S. Miller: On a point of order, Mr. Speaker: I am not a stickhandler. I block the shots; I am a goalie.
Mr. T. P. Reid: I think the Treasurer got his vowels and what not backwards.
I think I will do this by way of a point of order because, as you know, Mr. Speaker, it is the tradition now in the Ontario Legislature for members to rise, usually before the question period, to correct something that has been in the press --
Mr. Robinson: That is privilege.
Mr. T. P. Reid: That is not privilege. If my friend had been here and listened rather than barracking, he would know that it is a point of order that has now been accepted --
Mr. Robinson: We'll let the Speaker decide that, shall we?
Mr. Speaker: Proceed.
Mr. Robinson: Wait until the Speaker tells you --
Mr. Speaker: Order.
Mr. T. P. Reid: I think they are trying to give you direction, Mr. Speaker. In any case, on CBC's Metro Morning today --
An hon. member: Who told you about it?
Hon. Mr. Ashe: You weren't up then.
Mr. Speaker: Just ignore the interjections.
Mr. T. P. Reid: It is difficult, Mr. Speaker --
Interjections.
Mr. T. P. Reid: On Metro Morning today there was a program, which I believe is called Queen's Park Review, in which there are a couple of reporters from the press gallery who speak every Thursday morning about events that have happened in the Ontario Legislature.
Mr. Gordon: They interview each other, no doubt.
Mr. T. P. Reid: I am sorry, Mr. Speaker. I cannot hear the honourable member. He is mumbling as usual. You would think he was trying to take a position on the Sudbury strike. He is mumbling as usual so he cannot be taken to be on one side or the other.
Mr. Piché: Don't tell anybody you are from northern Ontario; it would look bad for the rest of us.
Mr. T. P. Reid: It is funny, Mr. Speaker, that my friend --
Mr. Speaker: This really has nothing to do with your point of order.
Mr. T. P. Reid: Mr. Speaker, the member for Cochrane North (Mr. Piché) has blasphemed me by saying that he wishes people knew that I was not from northern Ontario. I can tell him that almost every news outlet in my riding is Conservative, and I was speaking to one of those people just yesterday, who said: "You are doing a great job. Because of these taxes imposed in the budget of the Treasurer of Ontario and the Premier (Mr. Davis), who told us to remember the promise in the election of March 19, 1981, hammer them with everything you have."
Interjections.
Mr. T. P. Reid: All I can say is, the water sure has improved in this place. Mr. Speaker, you may be surprised to find that this speech may be a little shorter than you anticipated.
I am still on the point of order. In the radio broadcast this morning, one of the reporters from Queen's Park stated that I, the member for Rainy River, was filibustering Bill 111. First of all, that is factually incorrect. A filibuster -- and I have taken the time --
Mr. Piché: You are making a joke of the Legislature; that's what you are doing.
An hon. member: René, you do that daily.
Mr. Piché: You're not filibustering; you're making a joke of the Legislature. And your boss is sitting there applauding you.
Mr. Ruston: That's the only speech you've given in a year here.
Mr. Speaker: Order.
Mr. T. P. Reid: Mr. Speaker, those former Liberals always are confused when they change parties.
Mr. Ruston: That's right. He's one.
Mr. Piché: How can you say that?
Interjections.
Mr. T. P. Reid: However, to the point of order. The particular person from the press gallery, whom I do not see up there tonight, made two comments. First, he said this was a filibuster, which it obviously cannot be and is not by any of the recognized definitions of a filibuster. I am the first speaker on the bill, and any filibuster worth the name is something that goes on for hours and hours, days and days, week after week and involves a number of speakers. I draw the House's attention to the fact that I am the only speaker thus far.
8:10 p.m.
I simply believe any bill that gives this Treasurer the authority to raise $2.25 billion requires an extended debate. I cannot think of anyone who would, willy-nilly and without a great deal of thought and consideration, give this particular Treasurer, or anybody else -- particularly on that side -- the authority to borrow $2.25 billion. That is the first point.
Mr. Speaker: Is that your point of order?
Mr. T. P. Reid: That is the first point. But I am trying to point out to you, Mr. Speaker, that the record is factually incorrect.
The second thing that particular reporter said was that we were debating an obscure bill and that for one reason or another, at least in his mind, this was a bill of little consequence, with little impact on Ontario. He said this bill had little impact on the people who are laid off, on the people who are in the mines, the factories and the offices or on the people who are walking the streets in this province.
I took the time, unlike my friends across the way, to look up the word "obscure," just to refresh my memory as to what it meant. "Obscure," in Winston's dictionary, which most of our secretarial assistants use --
Mr. Peterson: Isn't that a restaurant?
Mr. T. P. Reid: I have not been to Winston's since I was taken there as a guest. I am looking forward to it again, under the same circumstances.
Mr. Peterson: I will take you again, Pat.
Mr. T. P. Reid: Again? He has not taken me there yet.
Mr. Speaker, speaking of Winston's restaurant, which my leader mentioned, reminds me: Have you been in the legislative dining room?
Mr. Speaker: That really does not have anything to do with your point of order.
Mr. T. P. Reid: I am sorry.
Mr. Speaker: But to answer your question, no.
Mr. T. P. Reid: You should go, Mr. Speaker, because on each and every table in the legislative dining room there is a handwritten sign, saying, "We wish to bring to your attention that as of black Monday, June 14, your dinner and luncheon bills" --
Mr. Speaker: May we get back to your point of order?
Mr. T. P. Reid: -- "will be taxed at seven per cent."
Mr. Speaker: Just for your direction, if I may: If you are referring to something that was said on the radio, it should be a point of privilege rather than a point of order.
Mr. T. P. Reid: I am sorry, Mr. Speaker; you are absolutely right. The member for Cochrane North, by mistake, was right for the first time since he has been here. I am sorry; he was right once before -- but that was when he was a Liberal.
The reporter really did say that it was an obscure bill, but here is Webster's definition of "obscure": "lacking or inadequately supplied with light: dark or dusty" -- I do not think we can accept that definition -- "withdrawn from the centres of human activity" -- to which we might add "reality," which is why the Treasurer has brought in the taxes he has -- "not readily understood or clearly expressed." That is probably one of the definitions of "obscure" we want to deal with, because I do not think the public generally understands that this man has all the power and authority to borrow $2.25 billion.
He stood in his place and said to us in this assembly -- you will recall; I believe you were in the chair, Mr. Speaker -- that a year ago or two years ago it took 30 minutes or 19 minutes to pass a similar bill. Can you imagine us on this side not doing our duty by ensuring that the people of Ontario know and understand that we are giving this man the power to raise $2.25 billion?
As I have indicated, and this will be the only repetition in the eight or 10 hours that I will speak on this bill, $2.25 billion equals the deficit which the Treasurer has projected for this year and which I have indicated is no doubt a smaller amount than we will actually realize by the time this fiscal year runs by.
Some other definitions of "obscure" are: "lacking showiness or prominence; inconspicuous, humble; not distinct; faint; constituting the unstressed vowel or having unstressed" -- well, we will not go into that.
Other definitions are: "obscure, dark, vague, enigmatic, cryptic, ambiguous, equivocal... not clearly understandable."
"'Obscure' implies a hiding or veiling of meaning through some defect of expression or withholding of full knowledge.
"'Dark' implies an imperfect or clouded revelation, often with ominous or sinister suggestion.
"'Vague' implies a lack of clear formulation because imperfectly conceived or thought out." That certainly applies to this budget.
"'Enigmatic' stresses a puzzling, mystifying quality." We find it that as well.
"'Ambiguous' and 'equivocal' both imply the use of the same word in different senses, 'ambiguous' suggesting inadvertence and 'equivocal' an attempt to confuse or evade."
There is another definition of obscure: "to make dark, dim or indistinct; to conceal or hide by covering or intervening; to reduce to the value of very little."
This is not an obscure bill. It may be obscure in the attention and understanding that the taxpayers of Ontario have about it, because I must say the finances of this government really are not well understood by most people in this chamber, including the Treasurer himself on occasion, but the bill is of fundamental importance.
The bill gives the Treasurer the authority to raise the money he needs to finance the mistakes of the past, such as the land banks, Suncor and all those things I have spoken about previously. I think the record should show, and that particular member of the press gallery should have it pointed out, that it is not an obscure bill. Perhaps it is obscure in terms of understanding, but its impact and effect are quite apparent.
Just as a matter of interest, in the Concise Oxford Dictionary the word right after "obscure" is "obsecration." Obsecration means "earnest entreaty." That is what we are here to do --
Mr. Nixon: Obsecration? You are obsecreting.
Mr. T. P. Reid: Obsecration. It is something like transmogrify. Does the Treasurer remember that word in his budget? Transmogrify; they took a nice, polite, friendly, realistic, rational, humorous man from Muskoka and turned him into a Treasurer who is mean, narrow-minded, grasping, Fagin-like in his approach and who has turned almost half of Ontario into tax collectors for him. That is what transmogrification means, in case the members wonder what that word meant in the dictionary. I confess I taught English in high school for two years.
Mr. Foulds: I don't believe that.
Mr. T. P. Reid: I took English in university.
Mr. Foulds: I don't believe that either.
Mr. T. P. Reid: My principal subject, by the way, was in economics, in case they wonder if I really know what I am talking about --
Mr. Foulds: That's even harder to believe.
Mr. T. P. Reid: I am glad to say, Mr. Speaker, that the Ministry of the Environment is working on the water taps in this particular institution.
Mr. Nixon: It's not really?
Mr. T. P. Reid: Yes, it really is. That is why this speech may be shorter than one thinks it is. That is what transmogrification is.
However, Mr. Speaker, when I indicated to you on Tuesday evening at 10:30 that I was just getting into the meat of my remarks, I misled you slightly, because I was just sort of giving you the prologue.
8:20 p.m.
Mr. Rotenberg: On a point of order, Mr. Speaker: The member for Rainy River raised a point of order. I think he is finished speaking on his point of order. I would like to comment on it, because the dictionary defines "filibuster" as "the use of extreme dilatory tactics in an attempt to delay or prevent action, especially in a legislative assembly." It says nothing about more than one person. I suggest, without talking about obscurity, that the CBC reporter was quite correct in calling this a filibuster and, if there is any ruling to be made, I hope you will rule that the CBC reporter was quite correct in calling this a filibuster according to Webster's dictionary.
Mr. Speaker: Thank you very much for drawing that to my attention. You are both out of order. I had said earlier it was a point of privilege.
Mr. Rotenberg: Well, I will raise it as a point of privilege on behalf of the reporter, who cannot defend himself in this assembly against the attack by the member for Rainy River.
Mr. Speaker: For purposes of clarification, the member for Port Arthur.
Mr. Foulds: Mr. Speaker, I resent this filibustering on the part of the member for Wuthering Heights.
Mr. T. P. Reid: Mr. Speaker, I mentioned to you that in looking up this word I came across the other word, "obsecration," which, quite frankly, I have not heard before. As I said to you, that word means an earnest entreaty. That is one of the reasons we are here and taking as much time as we think is necessary to deal with Bill 111.
We entreat the Treasurer and the Premier as earnestly as we can to accept the suggestion of this party that a legislative committee should deal with these tax bills, particularly the one that will expand the base of the retail sales tax.
We entreat them to hear those people who wish to come before it in a public way to exercise their democratic right so that they will feel there is something to the phrase "participatory democracy," so that they can have their say before the Treasurer and his colleague, who are imposing these taxes on them, and so that the private citizens who make up the people who put the government in here will be able to have an opportunity, as we heard earlier from my leader when he was talking about the people who run the mobile catering operations and others, to tell the Treasurer what impact these budget measures are going to have on them. I say that as an earnest entreaty. It is not done lightly. We all --
Hon. F. S. Miller: Mr. Speaker, I would like to have a point of order for a second. Is he on a point of order at the moment?
Mr. Speaker: No, he is not, really. He is proceeding with his debate.
Hon. F. S. Miller: I just wanted to correct something in the record, Mr. Speaker, if I may. That is a comment that I think is appropriate to the purpose of the debate tonight. This afternoon the Leader of the Opposition (Mr. Peterson) said in his comments:
"I want to point out something to the Treasurer. He is aware that there is precedence for budget bills going to committee. I refer him to Monday, March 19, 1962, reading from Hansard," etc. He referred to a budget bill going to committee by Mr. Robarts's motion. That was not a budget bill. That was an act to amend the Retail Sales Tax Act moved by the Leader of the Opposition of the day.
Mr. Peterson: Mr. Speaker, if I may speak to the point of order: The Treasurer will recall, because he was alive at the time, that there was indeed some discussion over the Retail Sales Tax Act of the day. The reality is that the Premier at the time moved that it go to committee, and he was very happy with that; so there is precedent for that in the circumstances.
The Treasurer may not call a Retail Sales Tax Act a budget bill or an amendment thereto. What we are talking about is the amendments to the Retail Sales Tax Act. The Treasurer may think he is quite cute tonight, as he usually does, but there is precedence for it.
Interjections.
Mr. Speaker: Order.
Hon. F. S. Miller: If there is cuteness here, it is being illustrated by the Leader of the Opposition at this moment.
Mr. Nixon: On the point of order, Mr. Speaker: The minister was selling used cars in the Paris area that year, or something like that, but I was just elected that year and the retail sales tax at three per cent was new legislation. The Legislature was consumed with concern about this innovation, and the Premier of the day felt it was necessary for the people to get a chance to discuss the ramifications of the Retail Sales Tax Act. It was sent to committee on his motion.
I put to the minister the fact that, whether it was a budget bill or anything else, we simply identified the bill by its number. We said it was an amendment to the Retail Sales Tax Act and, on motion of the Premier, it went to the standing committee for a full discussion. I suggest to the Treasurer that he should follow suit, because it is going to be a valuable discussion and one we need in this province.
Hon. F. S. Miller: The opposition takes great pains to correct me. I was simply pointing out that this afternoon the Leader of the Opposition said it was a budget bill that Mr. Robarts referred to committee. I have corrected the record, and that is all I have done.
Mr. Peterson: The Treasurer may or may not recall -- maybe he can remember back to about 2:30 this afternoon, when I quoted from Hansard exactly. It was the Retail Sales Tax Act, and the Premier of the day was speaking. He may want to draw some fine distinction.
I am trying to help the Treasurer. He may or may not understand that. I am saying he will not lose face if this bill goes to committee for a discussion where we can bring in outside witnesses so that we can enlighten the Treasurer as to the ramifications of this legislation he has brought before this House.
Mr. Speaker: Order.
Mr. Peterson: The Treasurer does not understand, perhaps, that I am trying to get him off the hook and not trying to put him on the hook.
Mr. Speaker: Quite obviously there is a difference of opinion. You have both stated your positions as to clarification, thank you. Now we may get back, I hope, to the member for Rainy River.
Mr. T. P. Reid: Mr. Speaker, I cannot think of anything more fundamental to the democratic process than talking about bills that are going to affect the raising and spending of money in Ontario. There are those, I know, on the other side who feel we should just roll over willy-nilly and accept what the Premier and the Treasurer bring into this House. However, Mr. Speaker, I know that you enjoyed my poem so much a couple of weeks ago on the matter of the budget that I have another one. This is an ode to Bill 111. It reads like this:
The Treasurer sits quiet and still,
In his hands are clamped tightly this bill;
He thinks Bill 111 is his ticket to heaven,
Yet his hands will be late to the till.
They will not be that late, because as of Monday, June 14, the Treasurer is going to be, as I said earlier today, the unseen guest at every meal the people have or send out for. It is an obscene presence at every meal, because everybody in Ontario is going to have to pay the seven per cent tax.
Mr. Speaker, I am sure you have seen the advertisements which the Ontario Restaurant and Foodservices Association has got in the newspapers in regard to it. We are concerned about that. We are concerned about the fact that many of the meals in cafeterias, for senior citizens, in camps and so on are all now going to be subject to this tax.
We are raising, by way of Bill 111, the money to pay for the Treasurer's expenditures for his and the Premier's priorities. We have asked time and time again since the budget was brought down -- I believe the date was May 13; it was not a Friday, but that was close enough for government work -- when the bad news of this budget was brought.
8:30 p.m.
One of the Treasurer's predecessors, Jimmy Allan, who was the Treasurer in 1962, was one of the finest men I have ever had the pleasure of serving with in this Legislature. He was one of the most intelligent, most reasonable and most competent people. It always surprised me, quite frankly, that he was not a Liberal. He said in his budget address: "By exempting food, fuel, rent, children's clothing, books, school supplies and medical expenses, we have avoided taxing most of the items that represent the greatest expense to families with small budgets. It bears lightly on low-income groups and more heavily on high-income groups, in accordance with the principle of ability to pay."
Those are the words of the Treasurer of 1962. Those words, to my mind, are as valid today in Ontario as they were then. In fact they are more valid, given the extreme economic circumstances of the province, given the number of people who find themselves laid off and given the number of people who find themselves on social assistance or whatever. This government is not giving those people relief, it is not giving them assistance, as any humane government would do. We on this side believe it is one of the essential principles of government and of the existence thereof to help those who need help the most and who find themselves in circumstances and straits where, perhaps temporarily, they cannot provide for themselves.
So Bill 111, which gives the Treasurer the authority to raise money under these various acts, we find repugnant; we find that we cannot accept it, and we ask him and his colleagues opposite to reconsider and to deal with our perfectly reasonable suggestion that he give people who are affected by these taxes the opportunity to discuss the impact and incidence of the tax burden on them.
There are just a couple of comments I would like to make. My colleagues and I are still getting calls every day, every evening. Some of my colleagues, I understand, were at a banquet tonight, and they have reported to me that even at that dinner people were complaining about the taxes levied on them. I throw out to the Treasurer that, since he has done so much for small business by giving them the tax holiday, he might consider retroacting that back -- I think that is a new word, Mr. Speaker -- to January 1. A lot of people are going to have a lot of difficulty with the economy today.
I have in my hand a letter that has come by way of my leader. We do not always understand the impact of these taxes, and I do not say this with any disrespect to my friends opposite. We read or hear the budget of the Treasurer; he gives us the measures in the budget, and he has referred already to the regulations and to those methods that are going to be used to put these various tax measures into effect. I would like to draw the Speaker's attention to this one that comes from Time-Life Records. It says:
"Thank you for your recent letter concerning the tax charge on your Great Men of Music invoices" -- before I started speaking like this, I used to be a soprano. "We have been informed by the Ministry of Revenue in Ontario that we must charge tax not only on the base price of our records which we send to Ontario residents, but on the shipping and handling charges as well."
We are not just talking about the tax on the tangible item that people get -- through the mail or otherwise -- but about a seven per cent tax on the services being provided. We are already taking a beating on the mail, through the federal government. Yet this Treasurer, who has expounded on occasion about how bad those taxes are, is now riding the gravy train and is levying taxes on those services provided as well.
The letter goes on to say, "As much as we regret having to do this, as it increases the prices for our Ontario customers, we must comply with the tax regulations and trust you will understand."
[Interruption]
Mr. T. P. Reid: It is the only thing I ever got from you.
The letter goes on to say, "We hope that, despite this, you will continue your interest in Great Men of Music." So there is more to this than meets the eye.
I would like to raise another matter with the Treasurer, and perhaps he can respond at some point. I am glad to see the Minister of Revenue (Mr. Ashe) here as well. As far as we know from talking with the food and restaurant people to some extent, but mostly with the mobile caterers today, they have not received instructions from the Ministry of Revenue as to how they are supposed to start collecting and remitting the tax on sandwiches and coffee and doughnuts as of Blue or Black Monday -- I prefer Blue Monday -- on June 14.
It again leads my colleagues and me to the conclusion that this budget was so ill thought out, so poorly prepared, that the government has not even prepared the regulations to put these punitive taxes into effect.
On this side, we are quite happy --
Hon. Mr. Ashe: Maybe they can't read, I don't know.
Mr. T. P. Reid: Have they got all this information? They certainly did not indicate that when they met with us. They are not sure. Do they have to have a new cash register on their mobile trucks?
Hon. Mr. Ashe: They knew you had booked a media studio so they did not want to disagree with your conclusions.
Mr. T. P. Reid: I have not booked any media studio. I am just a poor, humble boy from Rainy River. I do not even understand what the media business is about. It does not go as far as Rainy River so I do not know what he means.
What they have done -- and I hate to tell the Speaker this because he was one of the more rational Conservatives. He was so rational they took him off the public accounts committee.
Mr. Nixon: They were worried about him.
The Acting Chairman (Mr. Cousens): On Bill 111.
Mr. T. P. Reid: I want to talk about the matters in the explanatory notes. I have never understood them. Maybe the Treasurer or someone can give us an explanation. The bill is broken into two separate sections in the explanatory note. It talks about borrowing from the Canada pension plan, the Ontario treasury bill program and CMHC waste control loans. We all know these last come not from the province but from the federal government, but this gets lost in all the discussions about what the federal government pays for or does not pay for. Finally it talks about the federal-provincial municipal loans program.
8:40 p.m.
After listing those four, the explanatory note says:
"The amount of $2.25 billion authorized by the bill is intended to cover the following estimated borrowing requirements:
"1. The Canada pension plan borrowings;
"2. The teachers' superannuation fund borrowings."
Do you know what that means, Mr. Speaker? We are borrowing money to pay back what we have already borrowed. That is what it means. This is the obscure bill that some would refer to. This is the bill the Treasurer thinks we should spend 25 minutes or less on. We are talking about $2.25 billion.
I am sure members will recall with enthusiasm the other night when I was referring to volume 1 of the financial statements of the province. Because the Speaker was fortunate enough to spend a short period of time on the public accounts committee, he is one of the few who is aware of what is contained in the statements. I did not refer to all the financial statements relating to Bill 111 the other night. He will be happy to know that in the interim I have been through volumes 2 and 3 of the public accounts and there are matters directly related to Bill 111 in there that I think should be put on the record.
Mr. Speaker, I wonder if you would indulge me -- you are there, Mr. Speaker? I found, and I am sure you did, that every debate needs a little levity. While this poem is perhaps a somewhat small departure, it really deals with the essence and the impact of this bill and the budget of the Treasurer. These future remarks are called the Miller hit list. If I may, Mr. Speaker, I would just like to read it. It will not take long:
'Twas the night before Budget and all through the House,
The members were laden with serious doubts,
As to whether the Treasurer would demonstrate care,
In ensuring his taxes were minor and fair.
The Ontario people were snug in their beds,
But those who were psychic had visions of dread.
For the women and students and babies in town
Were about to be faced with good reason to frown.
The next day 'cross the land there arose a great clatter,
One glance at the Blue Book showed what was the matter.
Women, students and babies weren't the only ones hit,
The farmers, retailers and owners were sic-ed
With increases galore in provincial demands
To support wasteful jets and oil company plans
Of the Tory bureaucracy. Few folks were o'erlooked,
Even municipalities must reopen their books.
Restaurants, hotels and motels have been struck,
So have land owners, pet lovers and owners of trucks,
Retailers, commuters and taxicab types,
Schools, colleges, youth and toddlers alike.
It is hard to believe the insidious facts:
Conscientious conservers are now to be taxed.
So are those on fixed incomes and those who own cars:
To escape being hit you'd best move to Mars.
Not Santa's Village.
Then what to my wondering eye should appear,
But a smiling Frank and a great Tory cheer;
With a tired old cabinet so wasteful and smug
Who reacted to public outcry with just a shrug.
They whistled and shouted. I'd call them by name
But the 26 jokers are all just the same.
"Feign concern for the public! Feign concern for the poor!"
"Now let's off to La Scala, 'fore they ask us for more."
So off to a party the Tories did run,
And giggles and chuckles and an eve full of fun;
As opposed to the people the guillotine hit
From Ontario's lake to our northwestern-most tip.
[Interruption]
An hon. member: What is that noise?
The Acting Speaker: Order. It is clicking. I hope this is tied in to Bill 111.
Mr. Breaugh: They are just getting the beat over there.
Mr T. P. Reid: I am sure the Treasurer wants to hear this.
Frank was dressed in gauche plaid just like all other years,
But his deed was all tarnished by tension and fears.
A bundle of bullets he had slung on his back,
And he looked like a hunter who'd just caught our tracks.
His eyes how they twinkled! His lips how they twitched!
His cheeks were like roses! His hands how they itched
To skim off our savings, to thrust on us debt:
He hadn't caught wind we were on to him yet.
A wink of his eye and a twist of his head
Alerted us all we had plenty to dread.
He spoke many words with a grin on his face,
But the message delivered was from far outer space.
He dashed all our hopes then turned with a jerk
And left us to suffer the thrust of his work.
And shoving his fingers inside of his pants
this is parental guidance only --
He faced all the province with an arrogant stance.
[Interruption]
The Acting Speaker: I would ask the hoof beats to stop. Rudolph is in our midst.
Mr. T. P. Reid: I continue:
He then sprang from the House, to his team gave a whistle,
And away they all flew to drink from their crystal.
And I heard him exclaim as he drove out of sight, "Happy budget to all; I don't care 'bout your plight."
I think I should give credit to the author, Sara Clodman of our research staff, who has done an excellent job. I want to take what --
Hon. Mr. Eaton: They want credit for their research staff.
Hon. Mr. Ashe: Sounded like Bob Nixon to me.
Mr. T. P. Reid: I would like to know what the 400 people in the Treasury department did while they were drawing up this budget. When we analyse it, all we find is that the Treasurer, probably late at night down at the Albany Club, scribbled out what he was going to do in this budget on the back of an old envelope.
I have some background in economics. I do not pretend to understand very much about these things but I found after reading the Treasurer's budget that I understand a hell of a lot more than he does. What did he agonize over all these months when he brought in a budget like that for the people of Ontario?
My leader, everybody in this party and even some of the people opposite were saying, "Bring in a budget and let us hear what you are going to do." What did we get? We know what we got. The thinnest budget in Ontario. There are no studies; there is no information as to the incidence of the tax burden on those people who are going to suffer from these budget initiatives by the Treasurer, if we can call them that.
We do not have any budget studies to indicate where the province is going. We do not have all those reports and surveys that were at the back of other budgets to say what they are going to do. There is hardly a mention of the Board of Industrial Leadership and Development program which was supposed to be the great building block.
[Interruption]
The Acting Speaker: Order. Carry on.
Mr. T. P. Reid: I gather the member for Cochrane North is either rolling the two small brains he has around in his head or clicking his false teeth. I am certainly willing to let him continue.
The Acting Speaker: You have the floor and I would not want you to have any disruptions.
Mr. T. P. Reid: In speaking to Bill 111, if we look at the financial table --
[Interruption]
The Acting Speaker: Order. The member for Rainy River has the floor.
Mr. T. P. Reid: If the honourable member is going to continue to do that --
The Acting Speaker: I will give the member a warning that should that continue, you will not only lose your pencil, you might lose your presence among us for a while.
8:50 p.m.
Mr. T. P. Reid: I would hate to see a former Liberal leave, Mr. Speaker, but if that is your ruling, so be it.
Interjections.
The Acting Speaker: Order. Carry on, the member for Rainy River. Please do not allow these little disruptions to interrupt you.
Mr. T. P. Reid: I want to assure honourable members that little poem I read will probably be equal in popularity. It was done after business hours, as a sincere and serious operation, by our research people.
With reference to Bill 111, I want to refer to the financial tables and charts we find on page 27 of budget paper C of the member for Muskoka's 1982 budget, entitled Statement of Provincial Net Cash Requirements and Related Financing. All of these things sound so innocent and simple yet their effects are not only going to be felt by the present taxpayers of Ontario but those who will be paying taxes in the future -- our sons, our daughters, and probably their sons and their daughters. If I could refer to the member for Cochrane North -- well, sons and daughters would not be fair. In any case --
Mr. Piché: Try me.
Mr. T. P. Reid: I am not that hard up yet. We are talking about the net cash requirements. This has always been a mystery to most people who look at the financial statement of the province.
I hope that as I go along the Treasurer is taking note of the various questions that I raise, because I believe, as I am sure my colleagues on this side also do, that they are legitimate questions. We are looking for clarification and information.
I would like to know exactly what the Treasurer means by net cash requirements, because on occasion he does change --
Interjection.
Mr. T. P. Reid: It is not often you want to hear me speak. The Lord taketh and the Lord taketh away.
Mr. Robinson: The Lord giveth and the Lord taketh away.
Mr. T. P. Reid: On this side and with this Treasurer, the Lord taketh and the Lord taketh away all the time.
The Treasurer has defined net cash requirements in a number of ways to suit his purposes. In the fiscal year 1980-81 the revenue was $16,470,000,000, the expenditures were $17,273,000,000, leaving a net cash requirement of $803,000,000. For interim 1981-82, the revenue table was $18,855,000,000 and expenditures were $20,415,000,000, for net cash requirements of $1,560,000,000.
I just want to remind the members that the estimated net cash requirements for the period April 1, 1982, to April 1, 1983, are $2,232,000,000, which is almost exactly the same as the amount we are asked, under Bill 111, to give the authority to the Treasurer to raise. Now he is saying that his estimated revenue in 1982-83 will be $20,545,000,000.
This does not take into account the effect his budgetary measures are going to have on the economy of Ontario. If the people from the Ontario Restaurant and Foodservices Association are correct, if the mobile caterers are correct, if the people who are running cottage industries making dresses and suits at home and who are now being taxed on patterns, material and labour are correct, there are going to be a lot of people out of business.
The restaurant association, for instance, is forecasting that possibly 7,500 people are going to be put out of work as a result of taxing meals under $6. We are now going to tax everything from McDonald's --
The Acting Speaker: Is the honourable member talking to us on Bill 111, which is specific to the budget --
Mr. T. P. Reid: Mr. Speaker, perhaps you were momentarily distracted. We are being asked under Bill 111 to raise almost exactly the same amount of money by borrowing as is the deficit of the Treasurer. I am saying that the Treasurer has projected revenues of $20,545,000,000, and I am suggesting, because this bill will go through at some point or other with the arrogant majority, the revenues projected by the Treasurer are going to fall far short of $20,545,000,000.
If the restaurant and food services organization is correct, that one sector alone is going to lay off 7,500 people. They will not be able to meet their payrolls because people are going to stop eating out. The poor, the ones with lower incomes, are going to quit having their pizza once a week or once a month, their chicken and all the rest of it, because they will not be able to afford it.
Or they are going to feel, as I do quite frankly, that I am not going to order in any more. I am not going to give the Treasurer or the Premier the satisfaction of being able to tax my pizza, my chicken, my Chinese food, whatever it may be, seven per cent to pay for their jet, for their oil company, for their $40 million in advertising, for the almost $750,000 in public opinion polls which they will not make available to this legislature and to the public at large, and to pay for their land assembly schemes.
I am going to be referring to those land assembly schemes again, Mr. Speaker, because in the volumes of the public accounts there is the very interesting auditor's comment about how we do not charge the opportunity costs of interest any more to those schemes.
Mr. Speaker, I have here, courtesy of the restaurant association -- and I must confess to you that I ate the chicken.
Mr. Nixon: But there is the bag.
Mr. T. P. Reid: But there is the bag. I was going to send this to the Treasurer. I was only going to try to eat seven per cent of what was in this bag, but I did not. However, I will send this pizza over to him because it will probably be the last one the Treasurer has before Blue Monday when the seven per cent tax will go on it. He can give a piece to the member for St. George (Ms. Fish) in the back. She is looking a little piqued because, no doubt like every other Tory member, she has been getting laced by her constituents as to the taxes.
Mr. Bradley: She is getting calls from David Crombie.
Interjections.
The Acting Speaker: Order.
Mr. T. P. Reid: I am sure the Treasurer will take that home and warm it up. I suggest he do it on Monday because after that it is going to cost him seven per cent more.
9 p.m.
I suggested the revenues of the province are going to be less than the projections of the Treasurer. The expenditures are suggested for 1982-83 at $22,777 million. I now suggest as well that, before this year is up, we will have before this very assembly supplementary estimates, if history is any guide to us, in the nature of between $300 million to $500 million. I bring it to the members' attention because I do not believe I mentioned this before. The Treasurer was out on his estimated deficit, if one takes his figures, by 124 per cent in the last fiscal year.
The deficit is going to be, I would suggest, an additional $300 million to $500 million. I believe the Treasurer knows that already. He is going to have to borrow that. He is going to have to come back with another Bill 111 or 212 or 222 or 333, and he is going to have to get that money from somewhere.
The irony of all of this is it has been his own actions that have led to the shortfall in the revenues he expected, and his own actions have led to the increases in the necessary expenditures for people on social assistance and government programs, to help those who need it the most. That really is an irony.
As I said peripherally the other night, we tend to get carried away and to think that in effect this chamber is reality. It really is not because the people are out there on the streets of Toronto, the streets of Acton -- for my friend the member for Halton-Burlington (Mr. J. A. Reed), which is not on the map -- of St. George, Paris, Niagara Falls, Pembroke, Ottawa and Kingston.
One can go into northern Ontario. I gather my friend has left, but one can go into Timmins, Cochrane, Sault Ste. Marie, Sudbury where the strike is on, Thunder Bay, Fort Frances, Atikokan and Barwick. I could go all through my riding, Ignace, Emo and all the rest of it.
Those are the people who are going to feel the effect of all these budget measures. They and their heirs are going to be paying for the proceeds the minister is going to raise under these bills.
All we are asking is a chance for those people who are going to be most directly affected by the taxes the Treasurer is bringing in, an opportunity to come before the Legislature, before a legislative committee and say: "Mr. Treasurer, members of the Conservative Party, this is how we are being affected. This is what it is going to do to our lives. This is what it is going to do to our businesses."
I do not think that is an unreasonable request. I really do not. We have heard from my leader today, and others, that Mr. Robarts referred tax bills, and particularly the retail sales tax, to the public accounts committee. I can tell the members that, as chairman of that committee, I stand prepared to sit during the summer or whatever is required to hear --
Hon. Mr. Ashe: The way you are going you are going to be here all summer.
Mr. T. P. Reid: There is certainly one way to solve that problem. Allow people to have their say. I am prepared --
Mr. Gordon: When were you in your riding?
The Acting Speaker: Order. The member for Rainy River has the floor.
Mr. T. P. Reid: As a matter of fact it was last weekend. I do not sit on the fence, like my honourable friend, and I do not blow whichever way the political winds are blowing.
Interjections.
Mr. T. P. Reid: I can tell my friend, he is what some of his colleagues used to call some of us, an overnight guest.
They are calling him that right now. We are not saying that, his own colleagues are saying, "Now there is an overnight guest;" because he does not have the integrity to stand up and say what he really thinks. He cannot do that in Sudbury, he cannot play the little political games that he is playing. I have been through a lot more strikes and labour situations than he will ever think of; and the people of Ontario and Rainy River have appreciated my honesty in that regard.
Mr. Speaker: And now back to the bill, please.
Mr. T. P. Reid: Mr. Speaker, I am glad to see you back. I am being provoked by the member for Sudbury (Mr. Gordon), who I think was taking advantage of the fact that you were absent.
Mr. Gillies: Put a bag over your head and wrap it up.
Mr. Speaker: Order.
Mr. T. P. Reid: I am glad to see, I really appreciate seeing, that the member from Mazda is here again with us tonight. He is back from Belgium, a visit he tells me he paid for himself. It is really interesting that all the parliamentary assistants, and on occasion cabinet ministers, have these rubber postdated cheques. If nobody raises the issue the cheques bounce right back into their wallets but otherwise they pay for their own.
Mr. Speaker: Back to the bill, please.
Mr. Shymko: Where is Albert tonight?
Mr. Bradley: Who woke you up.
Mr. Gillies: Speaking of globe trotters, where is the member for Ottawa East (Mr. Roy)?
Mr. T. P. Reid: He did not go to Belgium.
Mr. Speaker, when you consider the quality of the interjections from the party over there, maybe some of them should only show up one night a week. They might sharpen their wits.
In regard to the money that we are raising by Bill 111, I would refer to page 2-35 of the public accounts: Schedules to Statements of Assets and Liabilities. You will know, Mr. Speaker, that one of the places that the Treasurer is going to get his money from is CMHC waste control loans, explanatory note 3 in the bill.
At the very top of page 2-35 of the public accounts, this is as of March 31, 1981, it says, "advances payable." In other words, they have received this money already from the federal government. They have had that money in their hot little hands. This is the government that says the federal government does not do anything for them. CMHC waste control loans is number three in the bill.
Mr. Speaker, I draw to your attention that in 1980, from the federal government under the CMHC waste control loans the government of Ontario received $65,493,447. That figure, I must admit, went down substantially in 1981 to $14,825,426. It says, and I think this should be on the record: "The Canada Mortgage and Housing Corporation advances funds to the province... Advances funds: I want you to be aware of that, Mr. Speaker, because what happens very often is that under these bills we are talking about this government has funds advanced to it ahead of the actual requirement for the funds, and the money sits in bank deposits earning short-term interest. This government gets the interest on that money.
When one is talking about $65 million in 1980 or $14 million in 1981, it does not take too many days for the interest on that money to become fairly significant. It gets to the point where the member for Brantford (Mr. Gillies) could afford to buy a North American car, for instance, just with that interest.
9:10 p.m.
"The Canada Mortgage and Housing Corporation advances funds to the province on an interim basis for a portion of the cost of waste control projects under construction." I am sure in Peterborough there are those kinds of projects, but I have yet to see on any of them that credit is given to the federal government for these projects.
Mr. Gordon: You are in the wrong House.
Mr. T. P. Reid: Maybe in Sudbury it is different.
The federal government is putting up this money. When a project is completed the advance is partially forgiven. In other words, it is money that the province gets from the federal government and some of it does not have to be paid back.
I am not an apologist for the federal government, but I think the people of Ontario should know that when the Treasurer, under Bill 111, says he is raising money for these reasons, he is also getting what amounts not only to interest-free but also, to some extent, capital-free contributions from the federal government. When a project is completed, the advance is partially forgiven and the balance is converted to a 40-year serial debenture.
While it does not say this in Bill 111, the federal government is a partner, to a large extent, in providing what some of us who have been here for a while would call a "forgiveable loan" from the federal government -- without, I might add, very little credit going to the federal government.
On page 2-35, in relation to Bill 111, there is something called Debentures and Notes Summary covering debentures and note liabilities of the province payable in Canadian dollars. We get right into where the government, by way of this bill, is going to get some of these funds, under the heading Nonpublic Debt.
I have never understood exactly what is "nonpublic debt." Presumably it means that we have not gone to the public credit markets of North America to raise the money. I think those of us who have had some grounding in economics and some experience in these matters would know that is what "nonpublic" means. To the uninitiated it might mean that this money somehow appears out of nowhere. But if it is nonpublic, what is the alternative?
Mr. Nixon: Private?
Mr. T. P. Reid: Private money? It does not come from the private sector because the terms "public sector" and "private sector" in this case mean exactly the same thing. That is why confusion reigns. It is something that the government for many a year has not tried to clear up. When the Treasurer reads his budget and says "nonpublic," the public who might be listening says: "Oh, well. They are not getting that money out of us. It is not costing us anything." But in fact it is.
They want to borrow $2.25 million under Bill 111, and I would refer members to Nonpublic Debt. Nonpublic debt, for those who do not know -- and maybe some of my colleagues on the other side do not know --
Mr. Nixon: They don't have any nonpublic debt.
Mr. T. P. Reid: They did not realize it. They tend to think after a certain number of years that it comes out of the air, but we are borrowing from the nonpublic debt. From the Canada pension plan investment fund, in 1980, it was $8,757,322,000. In 1981 we borrowed $9,295- ,194,000 from --
Hon. Miss Stephenson: Is this for your campaign?
Hon. Mr. Ashe: Smile at the camera.
Mr. T. P. Reid: I do not know who the young lady is but why does the minister not take pictures of the two best-looking people, myself and the Minister of Education (Miss Stephenson). We will print them side by side in the Rainy River Record and the people there can choose who they like.
Hon. Miss Stephenson: Flattery will get you everywhere.
Mr. Speaker: Back to Bill 111, please.
Mr. Robinson: Mr. Speaker, it pains me to rise in my place on such a point of privilege, but I am sure that if the member for Rainy River, who is just at this moment relaxing for a well-deserved hiatus, would reconsider his recent comment, he would recognize that the Provincial Secretary for Social Development (Mrs. Birch) is indeed better looking than he is.
Mr. Speaker: And now back to Bill 111.
Mr. T. P. Reid: There are two things I now agree with the member for Scarborough-Ellesmere (Mr. Robinson) about. One is his bill on child restraints, since I now probably have the most beautiful child in all Ontario, if not in all jurisdictions.
Hon. Miss Stephenson: The member has not seen my grandchildren.
Hon. Mr. Ashe: Or mine.
Mr. T. P. Reid: Do they smile? The other thing is that I bow to his superior knowledge and I agree entirely that the Provincial Secretary for Social Development is much better looking on all sides than I am.
Mr. Bradley: And more concerned.
Mr. T. P. Reid: I invite her or the Minister of Education to come up and run in Rainy River and we will see whether it is looks, intelligence or competence that really makes the difference.
Hon. Miss Stephenson: If it were that, you would not have been elected.
Mr. T. P. Reid: I will sic Jerry Snyder on you if you are not careful.
We are talking about the money that is going to be raised.
The Deputy Speaker: Yes, refresh my memory.
Mr. T. P. Reid: I am glad you asked. I was talking about the fact that under the bill we are going to raise $2.25 billion. I was just about to go down the list to explain to you and the other interested members how we arrive at that figure, because I think it is very germane to the bill. How can we pass a bill asking for $2.25 billion if we do not understand the components that go into arriving at that total?
I suppose we all become a little hardened, we become a little crass, we become a little tuned out after a while, when we consider our deficit this year is going to be $2.23 billion. Who understands what a billion dollars is, let alone $2.23 billion? How do we bring that down so that the people of Ontario can really understand it? One of the ways to do it -- and I admit my figures are a little out of date, but not much -- is to say that every person in Ontario is paying over $1,500 in income tax, retail sales tax, and soon. When we talk about a jet worth $10.6 million, or we talk about public opinion polls, or we talk about this, I think we have to bring it down to the individual.
Hon. Miss Stephenson: What about the three new federal jets that cost $30 million?
Mr. Nixon: That's different. They can be converted into ambulances.
Hon. Miss Stephenson: Oh no, they can't. Ours can.
Mr. Nixon: You are just like Her Majesty and the royal yacht Britannia.
Hon. Miss Stephenson: You are entirely wrong.
Mr. Nixon: Baloney. It is to haul you people around.
9:20 p.m.
The Deputy Speaker: Flying back into this stimulating speech; jetting even.
Mr. T. P. Reid: Mr. Speaker, you have, as usual, unerring taste.
I am trying to put the components that make up the $2.23 billion deficit and the $2.25 billion that the Treasurer wants to borrow on the record.
Mr. Nixon: You have already gone from A to B.
Mr. T. P. Reid: No, I have not got to B yet.
The Deputy Speaker: Order. We are trying to work this in to Bill 111. Would you tie this in for me?
Mr. T. P. Reid: Mr. Speaker, I guess you came into the chair just after I had explained the relevance. I was telling you or your predecessor about the fact that we are being asked by Bill 111, under the six matters raised, to come up with a total of $2.25 billion. I think it is important that we understand the principles behind this bill and the components that make up that total. I am sure, Mr. Speaker, as an individual member of this Legislature, you would not want to vote for a bill of such magnitude, a bill which would have such an impact, without understanding how the Treasurer arrived at that figure.
I was a little disappointed that the Treasurer, when the bill was introduced, merely got up and said, "I move second reading of Bill 111." We are talking about $2.25 billion. That is a rather large sum of money, yet the Treasurer does not feel called upon or accountable or responsible to even give an indication of how much he is going to raise from each one of these matters. He does not feel called upon to be accountable or responsible to say: "This is how we are going to get there. We are going to raise X number of dollars from the Canada pension plan. We are going to raise X number of dollars from Ontario Treasury bills."
Mr. Bradley: There goes the one-time Liberal member, and the one-time NDP member.
Mr. Gordon: Liberal-Labour.
Mr. T. P. Reid: Hear, hear. The member has been a Liberal, he has been a Tory; maybe he would like to take out a membership in the Liberal-Labour Party. It would do him a lot more good than what he is doing.
Hon. Miss Stephenson: There is only one member.
Hon. Mr. Ashe: That will double the membership.
Mr. T. P. Reid: Mr. Speaker, if you will allow me a small digression: The Liberal-Labour Party is the most successful political movement in Canada, if not North America, or as the Premier would say "any other jurisdiction," because we have one member who is in the Senate. We have one member, my brother John, who is a federal member of Parliament who runs under the Liberal-Labour banner. We have my own humble self. I run under the Liberal-Labour banner. We are the only ones, and we are 100 per cent successful. How can one knock success?
Mr. Nixon: His mother is going to be a candidate next time.
Mr. T. P. Reid: Whose mother?
Mr. Nixon: Yours.
Hon. Mr. Ashe: Has his mother got verbal diarrhoea as well?
Mr. Nixon: You will find out.
Mr. T. P. Reid: I would tell the Minister of Revenue (Mr. Ashe), as I told the Minister of Education, after the seven per cent tax on toilet paper, everybody in the province is going to be constipated after these budgetary measures. Nobody can afford diarrhoea in this province after this.
Before I was so rudely interrupted --
The Deputy Speaker: In all seriousness, I am trying to evaluate your discussion as to whether it falls under explanatory note 1, 2, 3, or 4, or under 1-2.
Mr. T. P. Reid: I was pointing out that if one looks under the explanatory notes, borrowing from the Canada pension plan and I refer to page 2-35 of the public accounts under the heading, Nonpublic Debt, the first line is: "Canada Pension Plan Investment Fund." This is where the Treasurer is going to get this money. It was $9,295,194,000 in 1981.
Now, the next line is: "Canada Pension Plan Investment Fund re: Ontario Hydro $500 million." One of the questions I have for the Treasurer is, is any of the $2.25 billion related to Ontario Hydro? I suspect it is not, because that is raised on what the Treasurer calls the public market. You see, they change the definitions. Under most circumstances the Treasurer would call that private enterprise or the private marketplace; but when it comes to borrowing the money that the people of Ontario are going to have to pay back, all of a sudden it is not the private marketplace any more, it is the public marketplace. That was $9 billion.
The municipal works assistance program. If you look under number 4 of the explanatory notes you will see federal-provincial-municipal loan programs. If you look under 2-35 of the public accounts 1980-81, the Municipal Works Assistance Act, it is $44,626,150. That is down, by the way, from $49,355,638 in 1980.
The Deputy Speaker: Are there any cents in there?
Interjections.
Mr. T. P. Reid: The Treasurer does not worry about that.
The federal-provincial winter capital projects fund was $43,178,272. Federal-Provincial employment loans -- I presume that also refers to note 4 in the bill -- were $13,316,368, which again is down from 1980 when it was $13,968,728. You get the federal-provincial -- all of these funds which this Treasurer is getting his money from and which we hear very little about -- the federal-provincial special development loans $2,782,575, which again is down from 1980.
Now we come to a couple of the biggies that are in the explanatory notes and that we are giving the Treasurer the authority to borrow from. I have figures that I am going to provide in terms of the interest rates paid on these funds, but I will just finish this off.
The teachers' superannuation fund in 1981 was $4,092,300,000, and every year it goes up, exponentially almost because -- I had this discussion the other night with the Minister of Education -- every time they get a raise the province matches whatever impact that has on their pensions. In 1980 it was $3,523,300,000. That is an increase of almost $500 million in that year. So every year the Treasurer finds more money to borrow out of that fund.
The Ontario Municipal Employees Retirement Fund was $1,293,025,000 -- and this is a figure I do not understand, maybe we will get an explanation of it. It is exactly the same figure in 1980 as it was in 1981. Quite frankly, I do not understand that, because if the contributions are based on the salaries that are paid to public servants, and if they got their annual increment, their merit increases and all the rest, I do not see how it could possibly be the same figure.
Hon. Mr. Eaton: It reflects the decrease in the number of civil servants.
Mr. T. P. Reid: No, it was not because of the decrease in civil servants. It could not possibly come out to exactly the same figure under any circumstances.
The Canada Mortgage and Housing Corp. in 1981 provided $266,041,813, for a total nonpublic debt of $15,550,464,178.
9:30 p.m.
There is another item there called Publicly Held Debt. This is notes, debentures and so on of the province of Ontario which the Treasurer on occasion likes to say are publicly held and which on other occasions, depending on his audience, he likes to say are privately held. The publicly held debt is $1,112,373,000.
The "total payable in Canada in Canadian dollars" is $16,662,837,178. We are a little short of the $2.25 billion we are asked to vote for in this bill.
We come to section (b), and that is where we see the rest of it. Under section (b), under Debentures and Notes Summary, we get into the fact that we have dollars -- public debt held in private hands, if one likes -- payable in United States dollars.
I do not have to tell you, Mr. Speaker, as big an investor as you are, what effect the exchange rate is having on the Canadian dollar. It has dropped. It is under 80 cents again vis-à-vis the United States dollar. Every time that goes down, any interest and principal we have to repay costs the Ontario taxpayers more money. This is "payable in New York in United States dollars, publicly held debt" -- again publicly held.
The "province of Ontario issue" -- those are bonds issued by Ontario -- is $18,138,000. That is not bad, but I can say that a lot of people could live on the difference in the exchange rate in the past three months, on the $18 million we have to pay back in American funds as opposed to Canadian funds.
I know most members are not interested in these matters. That is perhaps above the ordinary ken of a lot of people but, by God, are they ever important, because somebody has to pay for this. They are paying for it by paying seven per cent on their binders, their rulers, their Big Macs, their pets and everything else, because the money raised by the government is going to pay for this.
The Minister of Education herself will now be taxed because, as we all know, she is a rose in this House. If one went to buy her, it would now cost seven per cent retail sales tax.
Hon. Miss Stephenson: What have you got in your water glass, Patrick?
Mr. T. P. Reid: I am saving that for when I have finished.
Hon. Mr. Ashe: Is that ever going to happen?
Mr. T. P. Reid: I have left out one of the largest components. As I indicated earlier this week, we have had a lot of questions about this component of nonbudgetary transactions, as the government prefers to call them, which we are dealing with in Bill 111, because we are talking about the amount of money that has to be raised on the credit of the province of Ontario. We owe, payable in New York in United States dollars, "issued on behalf of Ontario Hydro," $3,690,389,000. We owe a "total payable in New York in United States dollars" of $3,708,527,000.
I did a quick calculation earlier. Every time the exchange rate of the Canadian dollar falls one per cent vis-à-vis the American dollar, do members know what that costs us?
Mr. Nixon: How much?
Mr. T. P. Reid: It is actually more than $3 million.
Mr. Ruston: Oh, I can't believe it. It would even hurt the Minister of Transportation and Communications (Mr. Snow) if he had to pay that $3 million.
Mr. T. P. Reid: Imagine how many roads the Minister of Transportation and Communications could build. I hate to use this word --
The Deputy Speaker: So do not use it.
Mr. T. P. Reid: -- but because there are so few interested members on the other side, I will slip it by them.
The Deputy Speaker: Careful.
Mr. T. P. Reid: That is an extremely conservative figure. One may think that is bad, but there is another component to this debt which we are building up and which we are being asked to pay for by way of Bill 111.
Under section (c) on page 2-35 of the public accounts, it says, "Total payable in Frankfurt, Germany, in deutsche marks, $33,269,183."
The total debentures and notes overall, which each and every taxpayer in Ontario now owes, let alone those who are to come, totals $20,404,633,361.
The Deputy Speaker: Where does this tie in to Bill 111?
Mr. T. P. Reid: Your attention may have wandered momentarily, Mr. Speaker.
Hon. Mr. Eaton: You can repeat it all.
Mr. T. P. Reid: Thank you. The member for Middlesex has asked me to repeat it, and I am prepared to do that.
I refer you to section 1 of the bill, Mr. Speaker, in case you have not read it. It reads:
"The Lieutenant Governor in Council" -- i.e., the executive, the Treasurer, the Premier -- "is hereby authorized to raise from time to time by way of loan in any manner provided by the Financial Administration Act such sum or sums of money as are considered necessary for discharging any indebtedness or obligation of Ontario.
This money I am talking about has to be paid back by somebody, somewhere, some time. I will read the rest of the first section.
The Deputy Speaker: No, it is not necessary.
Mr. T. P. Reid: I insist, Mr. Speaker, because you asked.
Section 1 continues: "...for making any payments authorized or required by any act to be made out of the consolidated revenue fund or for reimbursing the consolidated revenue fund for any moneys expended for any of such purposes, provided that the principal amount of any securities issued and temporary loans" -- temporary loans to pay the interest and principal on the moneys I have just read into the record; and listen to this -- "provided that the principal amount of any securities issued and temporary loans raised under the authority of this act shall not exceed in the aggregate $2.25 billion."
Mr. Speaker, you asked what relevance that had. If you would like to look at the figures I have just given you, I could have the page take this up to you.
9:40 p.m.
We are being asked to raise money to pay for the past debts of the province. We have been complaining in this Legislature about the jet and about Suncor at $650 million. We are paying $64 million in interest and very little principal for these things. We are paying $40 million for advertising to keep this government in power.
Where is the page going with that paper?
The Deputy Speaker: She'll bring it back. She's getting copies.
Mr. T. P. Reid: Oh, you want a copy, Mr. Speaker?
We are also paying for things like Minaki Lodge. Mr. Speaker, you fortunately were in the chair when the Minister of Northern Affairs (Mr. Bernier) promised me, in response to a question I asked, that if Minaki Lodge was not open next spring he and his assistant deputy minister would resign.
I am going to be here to see the Minister of Northern Affairs stand in his place, and say: "Mr. Speaker, there has been another delay. The $30 million we have spent on Minaki Lodge is not quite enough. We forgot one slight matter: we forgot to put rooms in the lodge."
I have not digressed from the principle of this bill in almost seven hours. We have to borrow the money to pay for this white elephant that the government, to protect its $500,000 loan to the original Minaki Lodge, is now involved in. By the time it is finished, it is going to cost the taxpayers $33 million just to protect $500,000. When I was in economics, that was called sending good money after bad.
Do the honourable members know that this government, these great managers who are in power because they can manage the economy, because they can manage money, tore down and destroyed the very things that gave Minaki Lodge the atmosphere it had? They tore down the original brick fireplaces and the beautiful wooden beams that were built at great expense in the early 1920s and 1930s, when people used to come from all over the world just to see it. They destroyed the ambience, as we say in Atikokan, of the entire lodge. This is no exaggeration. As I stand before --
Mr. Piché: Are you saying that Minaki Lodge is bad for northern Ontario? Is that what you are saying?
Mr. T. P. Reid: I am sorry. I will yield to my friend the member for Cochrane North if he has a comment.
Mr. Piché: No. Explain yourself. You can't be against Minaki Lodge. That's for the north, and you are speaking against it.
The Deputy Speaker: The member for Rainy River has the floor. The member for Cochrane North is making interjections.
Mr. Epp: Mr. Speaker, on a point of privilege: It is only fair and equal that the member for Cochrane North be given an opportunity to say his piece and ask his question. He was very rude and interrupted the member for Rainy River, and he should be given an opportunity because he wants to have his --
Mr. Piché: To start with, it was not a question. It was a passing comment.
Mr. Epp: There he goes again. He is interrupting a point of order.
The Deputy Speaker: The member for Rainy River.
Mr. Epp: Sorry, Mr. Speaker; he was interrupting me. As you know, I am trying to be very fair about this, and as soon as he started speaking I sat down.
The Deputy Speaker: And now you are going to sit down again, because the member for Rainy River has the floor.
Mr. Bradley: Mr. Speaker, on a point of privilege: The privileges of the Treasurer are being adversely affected tonight by the member for Rainy River. I will tell you why, Mr. Speaker.
The Deputy Speaker: Are you speaking on the Treasurer's behalf?
Mr. Bradley: Yes, on the Treasurer's behalf.
The Deputy Speaker: Is that in the standing orders?
Mr. Bradley: Yes, it is. The Treasurer was scheduled to speak to the St. Catharines Provincial Progressive Conservative Association at a fund-raising dinner tonight, but they had to accept what the Treasurer would consider to be second-best, and that is the Minister of Industry and Trade (Mr. Walker). I consider them to be in a dead heat as far as quality of speakers is concerned.
I want to say to my friend the member for Rainy River that he has destroyed the opportunity of the Treasurer to be greeted by the people of St. Catharines, and the sale of --
The Deputy Speaker: There is no point of privilege.
Hon. Mr. Ashe: As usual, Bradley, you said nothing.
Mr. Piché: Just what you have been saying all night: nothing.
An hon. member: That's just one notch better than the Minister of Revenue.
Mr. Bradley: In responding to the church people of Ontario, your response is charging them for church dinners. I'll tell you what they think of you: not much.
The Deputy Speaker: Amen!
Hon. Mr. Ashe: I hope next week he tries to swim across instead of driving. It would be appropriate.
The Deputy Speaker: The member for Rainy River: Here I am; talk to me.
Mr. Piché: Tell us how you are going to destroy Minaki Lodge; come on, tell us.
The Deputy Speaker: Never mind the member for Cochrane North.
An hon. member: Wait till we get on to Edwardsburgh; wait until we get on to some of the land assemblies.
Mr. Piché: I can tell you how much money is being spent in the south, but any time you spend money in northern Ontario this group is completely against it.
Mr. Breaugh: Why is the member for Cochrane North filibustering?
Hon. Mr. Norton: Reid's against the north.
Mr. Nixon: Who woke you up over there?
Mr. T. P. Reid: I do not know why the member for Cochrane North is trying to extend this debate, but I am prepared to stay here as long as it takes for me to get through my remarks.
I really want to point out that I cannot think of anybody in northern Ontario who objects to money being spent on the north -- but in productive ways that are going to help northern Ontario. Can anyone imagine this great Tory government destroying the very things that made Minaki Lodge what it was, which were, in effect, the fireplaces and the wood, and then being ready to open?
Mr. Piché: I can't believe that. I can't believe it.
Mr. T. P. Reid: I say to the member for Cochrane North, they were ready to open two years before he arrived here, and they made all these announcements. Then some bright person, who I think quit -- it must have been Darcy McKeough; he was the only bright person I can remember in a lot of years -- said: "What about the bedrooms? We forgot to build the bedrooms."
I have a feeling, because the member for Cochrane North is taking these things very seriously, that it is time to interject just one 10-second note of levity. Can I be permitted to do that?
The Deputy Speaker: Shall we have the agreement of the House?
Hon. Miss Stephenson: No.
Mr. T. P. Reid: We have had it. The Minister of Education (Miss Stephenson) interjected. That is our note of levity for the evening.
On Bill 111 -- part 2:
The net cash requirements are high,
But Frank Miller continues to sigh;
For $2.2 billion, they will tax 8.6 million,
For those puppies and that large pizza pie.
Mr. Piché: The member for Rainy River is repeating himself. He said that last Tuesday.
Mr. T. P. Reid: No. That is a new one.
Mr. Speaker, you asked probably the most pertinent question of the evening.
Mr. Piché: Have respect for the Legislature, please.
Mr. T. P. Reid: The member can call me the northern songster. It is better than what he has been calling me.
I have here the status of pension fund borrowings by the government of Ontario. By this bill, we are authorizing the Treasurer to borrow from the pension plans, particularly the Canada pension plan and the teachers' superannuation fund. If one looks at this, they have been raiding for years. As I said earlier, I am going to tell the members at what interest rate they have been borrowing these funds to pay for their wasteful and unproductive expenditures over the years.
It is strange, and they have got away with it to some extent, that they have convinced the public of Ontario that these are matters which have suddenly come upon us, that it is only because of the present economic situation that they find themselves in a position where they have to bring a bill to raise $2.25 billion.
9:50 p.m.
I have been here since 1967. The member for Brant-Oxford-Norfolk, Haldimand and other places has been here so long he has the longest name in the place. He can tell members that these unproductive expenditures, these wasteful expenditures, waste of taxpayers' funds, have been going on for years and years. It is only now, when the economy is bad, that we are reaping the harvest of the mistakes of past Conservative administrations and of the present one.
Under the bill we are going to borrow from the Canada pension plan and from the teachers' superannuation fund. From the estimate of March 31, 1982, we are looking at something like $9,895,000,000 in the CPP. Under the teachers' superannuation fund we are looking at $4,754,000,000. Under OMERS we are looking at $1,293,000,000 for a total of $15,942,000,000 of total nonpublic borrowing.
Mr. Nixon: Hydro isn't even in that.
Mr. T. P. Reid: Hydro is not even a component of that.
The frightening thing about all of this is the unfunded liability. I know all my colleagues in this party understand unfunded liability. I know all of the members next to me do, but I know the member for Cochrane North, among others, does not understand it, so I want to tell him that unfunded liability is simply that figure we owe for which there is no sinking fund or any provision for payment under the budget of Ontario.
What that means simply is that every year the taxpayers of Ontario have to come up with the money to pay that portion of the unfunded liability which is due and payable on the notes, bonds and borrowing of the province for this year.
I am trying to make this as simple as I can so the members for Cochrane North and Brantford (Mr. Gillies) can understand it. I know I am not doing a very good job because I cannot get it down to those simple terms. But I am hopeful and I know the people of Ontario are going to start understanding how badly this administration has put them in debt. They will start to understand why they now have to pay seven per cent on their canaries and seven per cent on their Big Macs, seven per cent on their Wendy burgers and seven per cent when they have somebody come in and fix their stove or fridge. They now have to pay seven per cent on those things.
Mr. G. I. Miller: And the seven per cent service charge on the service clubs.
Mr. T. P. Reid: That is the interesting thing. Wait until the Rotarians have to start paying seven per cent on their meals every Thursday.
These figures are a little out of date, but they are the most up-to-date figures we find for the provincial debt and the moneys owing.
The teachers' superannuation fund, $1.96 billion -- that is the evaluation as of December 31, 1979. These are the cumulative interest payments up to March 31, 1982, in millions of dollars: the CPP is $5,364,500,000; the teachers' superannuation fund is $2,013,400,000; the Ontario municipal employees retirement system $814.5 million; the public service superannuation fund is $1,126,500,000. Then there is something -- one of those miscellaneous matters -- which is a mere $156.4 million. It comes to a total --
Mr. Nixon: That is not the Legislative Assembly?
Mr. T. P. Reid: No, it is not.
It comes to a total of $9,475,300,000.
We really think these matters need more of a public hearing than just in this chamber. We have been through these debates before and we know how much attention is paid to them by the press or by the members here --
Hon. Mr. Ashe: Nobody pays attention to anybody who talks that long.
Mr. T. P. Reid: I have to agree with the Minister of Revenue because the Treasurer's budget this year was one of the shortest I have ever heard. Everybody in Ontario paid attention to it because he gave a slap in the teeth to every taxpayer in the province with that budget.
We are here to focus as much attention as we possibly can on these budgetary provisions. We want to give the people of Ontario as much time to understand the impact of this budget on their everyday lives as we possibly can. That is our function, and we also feel very strongly that this is the worst budget we have seen in a lot of years. We know --
Hon. Mr. Eaton: You know better.
Mr. T. P. Reid: No. I have been here a lot of years. I have seen some bad budgets. I remember John White and his sweater tax. He was going to tax energy. Of course he had never been to northern Ontario. Maybe the member for Cochrane North who was not here then, would have been a great supporter of John White who brought in the tax on energy. When we said, "But in northern Ontario the winters are longer and colder than anywhere else," his response was: "Buy a sweater. Wear two sweaters at night." We thought that was, if I may reverse an analogy, the epitome of lowness.
Interjection.
Mr. T. P. Reid: It is too late, obviously, for these literary allusions.
We thought that was about as bad as a budget could get. But I will say this for John White: He, the then Treasurer, at least rescinded that budgetary provision because the government realized the people of Ontario were not going to stand for those kinds of provisions.
That is what we on this side are all about. We know what we say and do in this chamber is not going to change the government's mind. We know that since March 19, 1981, we are faced with what the Premier somewhat grandiloquently refers to as "the realities of March 1981." This means, in the Premier's and the Treasurer's terms:
"We do not have to listen to anybody; we do not have to take anybody else's opinion into account; we can act like a dictatorship; we can trample on the rights and privileges of the Legislature; we do not have to listen to the citizens of Ontario; we will do what we bloody well please; and we are not going to give a public forum to anyone else.
"We know there are so many things going on in the world today -- the Falkland Islands crisis, the problems in the Middle East -- that any of these budgetary measures will, maybe, find themselves on page 34 of the Globe and Mail, probably not in the Star at all, and probably beside the Sunshine Girl in the Sun. And there will be a 30-second wonder on the television newscast."
Mr. Speaker, we would be derelict in our duty if we did not give our best to bring attention to this budget and its provisions and the fact that the people of Ontario are being asked by way of Bill 111 to provide the Treasurer with the authority to borrow $2.25 billion for what we consider in many cases extremely wasteful, unproductive and mismanaged resources. That is what we are here for.
10 p.m.
We are hopeful that my colleagues and I on this side and, I presume, those on my left, the slow members of the Liberal-Labour Party, will support us in this endeavour. No reaction?
Mr. McClellan: You are the last Liberal left in western Canada.
Mr. T. P. Reid: Yes. That is why I am laughing: Liberal-Labour.
The Acting Speaker: On Bill 111.
Mr. T. P. Reid: They will support us on it.
Mr. Speaker, I think this is very important. I go back to the fact that the Treasurer made no opening remarks about the fact that he was asking authority to borrow $2.25 billion. He did not tell us exactly how much he was going to get from these various funds, and he did not say anything about the interest rate he was going to borrow at.
I am now going to quote figures that will indicate the interest the Treasurer is paying on these borrowed funds in order to indicate in the best way I can why he is borrowing $2.25 billion, why he is using these funds to borrow it from and why he is getting it so relatively cheaply that it leads to sloppiness, to incompetence and almost to pure disdain for the taxpayers' dollars. This is because he is able to get these funds without having to borrow on what he refers to as the public market one day and the private market on the other. And he is borrowing this money to pay for all of his mistakes and those of past administrations that go back to when the present Premier took that office.
I am going to quote those figures now. I will give first of all the borrowings from the Canada pension plan, which members will find in number 1 of the explanatory notes in this bill and in subsection 2 of the bill. The net borrowings in 1977-78 were $851 million, in 1978-79 they were $916 million and in 1979-80 they were $988 million. We hit the big time in 1980-81, when we hit $1,038,000,000; and the projection now for 1981-82 is $1,269,000,000.
To give the complete picture, in 1980-81 and 1981-82 the province transferred $500 million of Canada pension funds to -- guess who? -- Ontario Hydro. To be fair, Ontario Hydro issued $500 in bonds and gave them back to the province of Ontario.
Mr. Nixon: Five hundred million dollars.
Mr. T. P. Reid: Yes, $500 million. So by some sort of sleight of hand and juggling and -- if I can go back to a phrase I used the other evening -- smoke and mirrors, we come to the conclusion that it did not cost the people of the province anything. We lent $500 million to Ontario Hydro and Hydro gave us $500 million back in bonds.
I am not going to get into a discussion of the fact that there is only one person who is paying either taxes or bills, whichever you prefer, but I can say that the consumers of Ontario are paying for the cost of Ontario Hydro -- which we have heard this week, last week and even before that, is out of control. The taxpayers are paying for it one way or the other.
I promised to say this, and I am getting to it now: The total debentures outstanding as of March 31, for 1981-82, are $11,064,000,000. In 1977-78, which was just the year before the current Treasurer assumed the position, they were $6,584,000,000. So in that five-year period the total number of debentures outstanding was a little less than doubled; it increased by about 47 per cent.
Here comes the significant part -- this is what we are not told by the Treasurer, who is asking us for authority to borrow all this money: The average interest rate in 1977-78 was 9.05 per cent on $6 billion plus; in 1978-79 it was 9.61 per cent on $7.7 billion; in 1979-80 the average interest rate was 10.75 per cent on $8.75 billion; in 1980-81 we paid an average interest rate of 12.73 per cent on $9.79 billion and in 1981-82 we paid in the fiscal year an average interest rate of 15.56 per cent on $11,064,000,000.
The point of all of this is that under Bill 111 we are asked to give authority to the Treasurer to borrow $2.25 billion. We have not been told exactly what amount from each fund he is going to get, or what interest rate he is going to pay, but by giving him authority to borrow this money under Bill 111, we would be accomplices. This party and other members, if they agreed, would be accomplices in the kind of waste, incompetence and mismanagement that we have seen in the past.
Those funds the government is borrowing from are the pension funds of the people of Ontario who are taxpayers. They are the ones who are going to have to pay the seven per cent retail sales tax to have their refrigerators fixed, their cars fixed, their lawnmowers fixed, their blenders, etc., fixed. They are going to have to pay for that. If they happen to be anyone who is also contributing to these pension plans they are going to be paying more, in the sense that they are going to be getting a lesser rate of return than if this money was lent out on what the Treasurer, in this regard, is happy to call the "public market."
I find that a complete misnomer. If the members were contributing to the Ontario Secondary School Teachers' Federation, the Canada pension plan -- which members of this Legislature cannot do --
Hon. F. S. Miller: The members can now.
Mr. Nixon: What can we do?
Mr. T. P. Reid: Can members contribute to the CPP?
Mr. Kerrio: Not if the government is going to use the money. I am not; no way.
Mr. T. P. Reid: When did that happen?
Mr. Nixon: No, you cannot. John Robarts opted us out.
The Acting Speaker: Order.
Mr. T. P. Reid: The Treasurer has seen fit to make an interjection, the first one this evening and he is wrong. Members of the Legislature cannot make contributions to the CPP -- unless there has been a change.
Interjections.
Mr. T. P. Reid: Maybe somebody knows something we do not know. But, certainly, as of our last caucus meeting we did not know we could contribute to the CPP.
The fact remains, as I said, one is going to pay twice --
Mr. Nixon: It is in the process.
10:10 p.m.
Mr. T. P. Reid: I find it disturbing news if I am going to be allowed to do that. That means I would be subsidizing the Treasurer. I am paying taxes to pay for his mismanagement. Now I will get a lower interest rate on the funds that he is taking out of my pension plan.
Mr. Nixon: John Robarts wanted to see the CPP fail. He didn't want Judy LaMarsh's initiative to succeed. He kept us out.
Mr. T. P. Reid: Because this is a fairly esoteric and complicated business, it would be helpful if I explained to you, Mr. Speaker, computer expert that you are, that even with a computer you would have trouble following the machinations of the Treasurer on this.
I want to explain the interest rates on borrowed CPP funds. The interest rate charged on CPP debentures is a weighted average of yields for the first three days of a given month for government of Canada bonds with 20 or more years to maturity.
There is also a CPP operating fund equal to three months' benefits. Interest earnings of the operating fund are calculated on a daily basis using the three-month Treasury bill yield during the month less one eighth of one per cent. I know that explains perfectly what is going on.
The allocation of the CPP surpluses is that excess CPP revenues are lent -- that is where Bill 111 comes in --
Mr. Nixon: Except that it will never get the money back.
Mr. T. P. Reid: -- are lent to the provinces on a prorated basis which is a function of their 10-year contributory history. In return, the provinces issue nonmarketable -- that is what I would have called "private" but the Treasurer calls "public" -- nontransferable, nonassignable, fixed-term securities, written for terms not to exceed 20 years.
In other words, as simply as I can say it, the CPP contributions of the people of the province are lent back to the province, which uses them and has used them in my term here to pay, to a large extent, the deficits of the province at a lesser rate, I believe, than could be found on the market of the day.
The Treasurer and his predecessors have had a large pool of money available to them to finance their boondoggles of one kind or another. This is the frightening thing; it really bears out the theory that governments have a stake in inflation.
The CPP contribution and the payout about 1982, 1983, 1984, somewhere in that range, should have equalled and balanced out. In other words, the money raised by the people of the province who paid into the Canada pension plan should have equalled the amount of money that the province was borrowing and the interest the province owed in those funds. That is, the money that we would be able to get out of that fund should equal the interest that we had to pay back on the funds already borrowed from the CPP. It may sound complicated, but it is relatively simple.
What has saved this Treasurer for the last two or three years was one simple fact: it is called inflation. Had inflation not occurred, the funds in the CPP, the borrowings, would have equalled the interest payable. Because of inflation, obviously the amount of money that was paid into that fund has expanded. It was higher than the projections of both the federal and the provincial governments, which has given this government -- and I do not mind saying the federal government -- a stake in inflation.
One wonders sometimes, and I say this very seriously to all members in this House, if governments are not the greatest recipients in the country of the benefits of inflation because as inflation increases, certainly it increases the costs and expenditures, but it also inflates their revenue.
It is interesting that in this budget of the Treasurer, and certainly in his last two or three budgets, to a large extent he counted on that. As long as the economy was expanding, as long as incomes were rising by 10 or 15 per cent, obviously their tax revenues were increasing by at least that rate, so they had money to meet their commitments. I have no hesitancy in saying the federal government was probably operating on this basis as well.
Mr. Nixon: How are these people going to pay back these loans?
Mr. T. P. Reid: That is what one wonders. With a civil service of 82,000, with a Ministry of Treasury and Economics of 400, which used to have some of the best brains among the civil servants in Canada --
Mr. Nixon: Now they are just hiring public relations officers.
Mr. T. P. Reid: They used to have one of the best Treasurers.
They have banks and banks of computers to figure these things out, they have access to the best brains in the world, and we wonder how they could find themselves in the position and situation that they find themselves in today. I really, honestly wonder. I cannot understand them.
The Treasurer found himself and the government in this quandary. They found themselves with a few ill-chosen and wrong-headed, misplaced priorities, such as buying oil companies at $650 million, and $325 million of Canadian funds went immediately to Radnor, Pennsylvania, including $64 million in interest payments. It is going to cost the taxpayers of Ontario $48 million or $49 million in interest payments for at least, based on the most optimistic projections of the Treasurer and the Minister of Energy (Mr. Welch), 15 years.
He found himself with a great shortage of funds and a large deficit which he now has to finance by the borrowings that he is asking this House to authorize by way of Bill 111. It is not just Suncor that put him in this situation; it has been mismanagement over the years and the gradual buildup of how that has happened, and I have just given the House those figures.
I just gave the figures of the borrowings from the Canada pension plan and the interest rates that we have had in relation to Bill 111. That was one of the components of the bill. Now I turn to the Ontario borrowings from the teachers' superannuation fund.
Mr. Shymko: Let's hear it.
Mr. T. P. Reid: I thank the member for High Park-Swansea (Mr. Shymko). I intend to give all of it to him to add to his education.
Mr. Peterson: When are you going to get into the meat of your speech?
Mr. T. P. Reid: My leader asks when am I going to get to the meat of my speech. I am rapidly approaching the end of my prologue and I intend to really get into the nitty-gritty of our objections to this bill perhaps at some later date.
I have already put on the record the funds borrowed and the interest rate in relation to the borrowing from the Canada pension plan. I want to talk now about the Ontario borrowings from the teachers' superannuation fund. Whichever side we sit on as members, almost all of us have had approaches and briefs and so on from the teachers' superannuation fund as to the rate of interest that has been paid on these funds.
10:20 p.m.
In borrowing from the teachers' superannuation fund, and I just want to give some historical background, the amount moved from $488 million in 1977-78 through 1978-79 to $429 million; through 1979-80 to $537 million; through 1980-81 to $569 million; through 1981-82 to $670 million, and that is an interim estimate because we do not know for sure at this time what the final figure is. The total debentures outstanding as of December 31 from the teachers' superannuation fund were in 1977-78, $2.151 billion; in 1978-79, $2.685 billion; in 1979-80, $3.205 billion; in 1980-81, $3.796 billion, and in 1981-82, $4.407 billion.
This is a question I hope the Treasurer will answer. Again, we want to know what the interest rate is. If we look at the interest rate for 1977-78, it is 9.82 per cent; for 1978-79 it is 9.51 per cent; for 1979-80 it is 9.83 per cent; for 1980-81 it is 11.05 per cent, and for 1981-82 it is 13.34 per cent. I cannot think of any small home owner, or large home owner for that matter, any businessman or any farmer who would not jump at having an interest rate of 13.34 per cent. When the bank rate -- and I am sorry I did not hear what the bank rate was today; maybe the parliamentary assistant to the Treasurer can tell us.
Mr. Jones: You know the difference between a government borrowing and the market.
Mr. T. P. Reid: For a Conservative that is a very strange statement. He differentiates between government borrowing and business borrowing. I always thought a Conservative thought government was business. We certainly heard from the Treasurer in his budget that he really thought that. Is the parliamentary assistant really saying to me or to the House that there is a great deal of difference between the way the government operates and the way private business does? I agree, I think that is what he is trying to say, because if I could borrow money at that interest rate, I might go out and make a lot of ridiculous expenditures too.
In 1981-82, out of the teachers' superannuation fund, the government is paying something like an average interest rate of 13.34 per cent when the average interest rate paid by small businessmen, by home owners if they have a mortgage, by farmers --
Mr. Jones: You can't compare it.
Mr. T. P. Reid: Why can't we compare it? I guess the member is right, we cannot compare it. If the government had to pay the funds that it raised on the public market, as the Treasurer is fond of saying, I think it would have been a lot more careful in the moneys and the expenditures it made. If it is borrowing at five or six per cent less than the market is charging, it is found money. The government can say, "We can afford all these other things because we do not have to pay the going rate of interest." It is that simple.
Mr. Jones: That is why he has always preferred that to --
Mr. T. P. Reid: I know, but --
Mr. Jones: -- larger borrowing. That is the money --
Mr. T. P. Reid: That's right, but that is our whole point. The Treasurer and his predecessors have always preferred getting the money out of the Canada pension plan and the teachers' superannuation fund. But is that fair, particularly to the teachers who are not getting market value, who are not having their funds invested at the best possible rate of interest, who are certainly not making any kind of capital gain or market interest rate out of their savings? That is not fair.
Sure, the government is saying that we can save five or six per cent by getting this money out of these funds. So it does not make a lot of economic sense. I would have thought the parliamentary assistant, being a good Conservative, would be the first one to stand in his place and say, "Mr. Speaker, if you give somebody something for nothing or for less than its value in the marketplace, he is not going to take it very reasonably; he is not going to appreciate it, and he is going to squander the money." That is what I would have thought he would say, and I think he is probably right, if I can put words in his mouth.
How about the teachers' superannuation fund?
Mr. Speaker: Back to Bill 111, please.
Mr. T. P. Reid: Well, Mr. Speaker, I am right on that, because we object to the fact that the funds the Treasurer is going to borrow under the authority of this bill, he is going to get more cheaply than anybody else can get them in the marketplace. The parliamentary assistant and the Treasurer are getting people twice. The people who are contributing, particularly to the teachers' superannuation fund, are those who are also getting less interest paid into their fund than they would under a market system of interest.
The parliamentary assistant will probably say, "Yes, but we are guaranteeing their pension fund." That is a sore point with me and with a lot of other people, and I raised that on Tuesday night. I think this is something that has to be dealt with seriously by this government. We are allowing each local and regional school board to give the teachers in their area a raise in salary, on which their pension is based, and automatically their contributions to the pension fund, and therefore their benefits, go up. And we are a third party that is saying, "Fine, we are going to pay it." I find that a complete abnegation of fiscal responsibility. I do not know how this government could have got itself into that position and allowed it to go on for so long.
Under the authority of Bill 111 we are going to be raising $2.25 billion. The government makes investments and issues bonds and so on in regard to the Canada pension fund. I have a table here which indicates that to December 1981, Ontario has been --
There is a lot of noise here, Mr. Speaker. I am having trouble concentrating.
Interjections.
Mr. T. P. Reid: These are very complicated matters, and I am trying, for my friends in the back row, to make them as simple as possible.
If you look at the bonds or the securities that have been guaranteed, Ontario is well out ahead of the rest of the provinces. We know, of course, that Quebec has its own pension plan, so it is not a large borrower, obviously, from the Canada pension plan. But Ontario has guaranteed outstanding bonds of $10,788,800,000.
If you look at the scale, Alberta has $2.065 billion and British Columbia has $2.975 billion, and they are about the closest of anybody to Ontario. Obviously, Ontario has been the largest borrower from the Canada pension plan under the authority of acts such as this in the past.
Of course, we realize that we are also the province with the largest population. Still, we object to the fact that the province has been taking advantage of what we consider to be easy money to finance some of their crazy projects.
10:30 p.m.
Mr. Nixon: The payback is now equivalent to everything they borrowed.
Mr. T. P. Reid: That is right. We are asked to give authority to the Treasurer to raise this money. I want to read into the record what I call, "the Miller hit list." Under this budget there are about 20 groups in our society that are hit by these taxes of whichever kind the Treasurer is imposing and for which he wants us to give him authority to cover the expenditures of his budget.
This is the "Frank Miller top 20." The restaurant and food service industry, including restaurants, drive-in restaurants, dining rooms, cafeterias including schools and universities --
Mr. Speaker: I direct the member's attention to the clock.
Mr. T. P. Reid: Tempus fugit when one is having fun.
On motion by Mr. T. P. Reid, the debate was adjourned.
The House adjourned at 10:32 p.m.